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LONDON, May 11 (Reuters) - Italian banks shone in lacklustre European trading on Thursday after results led by Unicredit whose results indicated its turnaround was gathering pace.
Europe's STOXX 600 slipped 0.1 percent while both the eurozone's broader stocks and the blue chip index fell 0.2 percent.
Financials were a bright spot on the benchmarks for the second day running, with Unicredit up 4.4 percent after rising revenues and lower loan losses boosted it to better than expected first-quarter profits.
Italy's banking index tested its highest levels in more than a year as Mediobanca, Ubi Banca, and Banco BPM rose 1.8 to 3.5 percent in concert.
Telecoms stocks were among the worst-performing with BT down 1.7 percent after it announced 4,000 job cuts in a restructuring plan to recover from a year it said was 'challenging'.
Shares in Britain's biggest telecoms company have not recovered from a 20 percent drop after it revealed accounting malpractices in Italy in January.
Spain's Telefonica also fell 1.7 percent after its results.
A setback in its generic drug Advair's approval by the U.S. Food and Drug Administration sent Hikma shares down more than 8 percent, the worst-performing European stock.
Broker downgrades weighed on some of the top fallers. Centrica fell 5.8 percent after JP Morgan cut it to 'underweight' from 'overweight', while a rating cut from Citigroup sent Hannover Re down 5 percent.
Reporting by Helen Reid, Editing by Vikram Subhedar