By Natsuko Waki

LONDON (Reuters) - World stocks slipped back towards this week's five-month low on Friday as steadying oil prices failed to erase concerns about slowing economic growth and rising inflation, and as banking stocks came under renewed pressure.

The euro failed to benefit much from the European Central Bank's quarter percentage point interest rate rise on Thursday, and the region's government bonds rose after President Jean-Claude Trichet said he had no bias on monetary policy, dousing speculation about aggressive rate increases this year.

A less hawkish tone from Trichet, followed by U.S. job data which was in line with expectations, gave equity investors only short-term solace.

Exerting pressure on banking stocks, investment bank Goldman Sachs lowered its price targets for over 40 banks, saying that the sector was weighed down by the risk that banks will need to raise extra capital.

"We cannot get any big relief as long as the overall stagflation fears hang over the market, and the oil price is a major factor in this. There will be a wave of downward pressure on equities after any recovery," said Gerhard Schwarz, head of global equity strategy at UniCredit in Munich.

"The big question on equity markets is: how far will the derating go, and when will valuations find a bottom as we consider inflationary pressures not seen in two and a half decades?"

The FTSEurofirst 300 index fell 0.8 percent while MSCI main world equity index .MIWD00000PUS was down 0.3 percent, having hit its lowest level since January on Thursday.

U.S. markets are closed for the Independence Day holiday.