LONDON (Reuters) - European shares fell on Wednesday in cautious early trading on the eve of a European Central Bank meeting, while tensions on the Korean peninsula weighed on risky assets.
The pan-European STOXX 600 (STOXX) index was down 0.4 percent, poised for its third straight day of losses, while euro zone blue chips (STOXX50E) retreated 0.3 percent.
Germany's DAX (GDAXI) fell 0.3 percent, and Britain's commodity-heavy FTSE 100 (FTSE) declined 0.4 percent.
Financials were the biggest weight, with euro zone banks (SX7E) extending their slide from the previous session as the sector came back in focus ahead of the ECB's policy meeting on Thursday, which will be watched for possible signals of monetary tightening.
Denmark's Jyske Bank (CO:JYSK) was the biggest STOXX faller, dropping 4 percent after BRFholding reduced its total number of shares in the lender.
Geopolitical jitters between North Korea and the United States maintained pressure on markets, after North Korea warned of "more gift packages" for the United States.
Almost every European sector was in negative territory, with basic resources (SXPP) down 0.7 percent and oil and gas stocks (SXEP) falling 0.5 percent as commodity prices declined.
Elsewhere results spurred some sizeable individual stock moves, with shares in Micro Focus (L:MCRO) soaring more than 7 percent to the top of the STOXX after giving a third quarter update.
British housebuilder Barratt Developments (L:BDEV) declined 3.2 percent following its update.