STOCKS NEWS EUROPE-Santander suffers after UBS downgrade

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09:33GMT 14Jan2009-Santander suffers after UBS downgrade

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Shares in Spain's largest bank Santander (SAN.MC) lose 4.4 percent to 6.32 euros, underperforming a weak trend in banks across Europe, after UBS cuts its stance to "sell" from "neutral" while reiterating a 6 euro price target.

In a research note, UBS says the downgrade follows a recent rebound in Santander's shares, but the investment bank also says a tough macro-economic environment in Spain could challenge Santander's 30 percent price premium to peers.

Traders also note follow-through selling after yesterday's losses when the Wall Street Journal reported Spain was probing the bank over the exposure of more than 2.3 billion euros ($3.06 billion) in client funds to alleged swindler Bernard Madoff.

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