European stocks edge lower, Credit Agricole sinks

By Blaise Robinson

PARIS, May 13 (Reuters) - European equities ended slightly lower on Tuesday, as signs of resilience in U.S. retail sales was not enough to eclipse inflation fears that hit UK stocks, while banks fell on renewed concerns over asset writedowns.

France's biggest retail bank Credit Agricole (CAGR.PA: Quote, Profile, Research) tumbled 5.6 percent after unveiling a capital increase of 5.9 billion euros following more subprime-related writedowns.

The FTSEurofirst 300 index of top European shares closed 0.03 percent lower at 1,346.08 points, with the DJ Stoxx banking index down 0.4 percent.

Wal-Mart Stores Inc's (WMT.N: Quote, Profile, Research) disappointing outlook also weighed on the market. While the retail giant reported stronger-than-expected earnings, it said results for the current quarter could miss analysts forecasts, citing a tough economic environment as well as higher transportation costs.

Energy stocks lost ground, surrendering some of their recent hefty gains, as U.S. crude oil futures hovered around $124 a barrel, easing from a record high of $126.40 touched on Monday.

Repsol YPF (REP.MC: Quote, Profile, Research) lost 0.7 percent, Royal Dutch Shell shares traded in Amsterdam (RDSa.AS: Quote, Profile, Research) shed 1.2 percent, and gas producer BG Group (BG.L: Quote, Profile, Research) lost 3.7 percent.

Shares of mining companies rose, with Rio Tinto (RIO.L: Quote, Profile, Research) gaining 3.7 percent as traders cited market talk that rival BHP Billiton (BLT.L: Quote, Profile, Research) could sweeten its takeover offer for Rio.

BHP declined to comment. The company's stock gained 1.4 percent.