Europe shares trade flat early; C.Agricole weighs

By Sitaraman Shankar

LONDON, May 13 (Reuters) - European shares traded flat early on Tuesday, as British stocks weakened on inflation data and Credit Agricole (CAGR.PA: Quote, Profile, Research, Stock Buzz) weighed after announcing a capital increase, offsetting gains in defensive utilities and drugs.

At 0854 GMT, the FTSEurofirst 300 index of top European shares was flat at 1,346.23 points.

Miners Rio Tinto (RIO.L: Quote, Profile, Research, Stock Buzz) and Anglo American (AAL.L: Quote, Profile, Research, Stock Buzz) rose around 1 percent but banks were mixed. Credit Agricole fell 4.5 percent after saying it planned a capital increase due to further writedowns at its Calyon investment banking unit.

British lender Alliance & Leicester (ALLL.L: Quote, Profile, Research, Stock Buzz) slid 7 percent after it took a 192 million pound hit to profit from assets tarnished by a credit crunch, taking its earnings in the first four months to below 2007 levels.

Societe Generale (SOGN.PA: Quote, Profile, Research, Stock Buzz), the French bank hit by the world's worst rogue trader scandal, fell 0.1 percent after first-quarter net profit fell, though it was ahead of analysts' forecasts.

UBS (UBSN.VX: Quote, Profile, Research, Stock Buzz) rose 1.4 percent, HSBC (HSBA.L: Quote, Profile, Research, Stock Buzz) gained 0.8 percent and Santander (SAN.MC: Quote, Profile, Research, Stock Buzz) put on 0.4 percent.

Analysts said the corporate results season appeared broadly positive but there could be trouble to come.

"We're tap dancing on fairly thin ice," said Justin Urquhart Stewart, investment director at Seven Investment Management.  Continued...