UPDATE 1-Ubisoft reassures investors on Assassin's Creed 2

* Assassin's Creed 2(AC2) sales up 32 pct over 1st week AC1

* AC2 sold 1.6 mln units in 1st week of launch * Shares down 7 pct on AC2 fears, turn positive on news

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PARIS, Nov 24 (Reuters) - Ubisoft (UBIP.PA) said on Tuesday its Assassin's Creed 2 adventure game had record sales in the first week of its launch, quashing fears the potential Christmas season blockbuster was not doing as well as expected.

The world's third-largest independent video games publisher said internal estimates showed that first week sales of the game reached 1.6 million units worldwide.

This represented a 32 percent growth over the first week sales of the first opus of Assassin's Creed, the statement said.

Ubisoft shares fell by as much as 7 percent in morning trade on fears of disappointing first-week sales for the game.

By 1435 GMT, the shares had erased their losses and traded up 0.43 percent at 10.54 euros.