Europe shares fall, led by miners; all eyes on Citi

* FTSEurofirst 300 falls 0.4 percent

* Oils and miners lead losers; banks recover

* Citigroup results in focus after mixed signals on banks

By Sitaraman Shankar

LONDON, July 18 (Reuters) - European shares slipped on Friday, weighed down by commodity stocks, while banks recovered ahead of key results from Citigroup (C.N: Quote, Profile, Research, Stock Buzz). By 0839 GMT, the FTSEurofirst 300 .FTEU3 fell 0.4 percent to 1,141.38 points, but was on track to eke out a gain of 1.4 percent for the week thanks to a jump on Thursday.

Lower metal prices and a cooling off in crude took heavyweight mining and oil stocks lower.

Eurasian (ENRC.L: Quote, Profile, Research, Stock Buzz), Xstrata (XTA.L: Quote, Profile, Research, Stock Buzz), Rio Tinto (RIO.L: Quote, Profile, Research, Stock Buzz), Anglo American (AAL.L: Quote, Profile, Research, Stock Buzz) and BHP Billiton (BLT.L: Quote, Profile, Research, Stock Buzz) lost 3-6 percent as copper futures <MCU3=LX> fell 0.7 percent and gold <XAU=> traded lower.

Oil inched up to nearly $131 a barrel but was still off nearly 10 percent this week, and energy shares Total (TOTF.PA: Quote, Profile, Research, Stock Buzz), Royal Dutch Shell (RDSa.L: Quote, Profile, Research, Stock Buzz) and BP (BP.L: Quote, Profile, Research, Stock Buzz) were down 0.2-0.5 percent.

But investor focus shifted squarely onto results from Citigroup later in the session, after JPMorgan's (JPM.N: Quote, Profile, Research, Stock Buzz) figures pleased investors but Merrill Lynch (MER.N: Quote, Profile, Research, Stock Buzz) posted a bigger-than-expected loss on Thursday, sending mixed signals about a banking sector battered by a credit crisis.

Analysts said that despite Merrill, results from banks had not been as bad as feared.

"It's difficult to derive a general picture on the bank results, but one could say they are more reassuring than not," said Thierry Lacraz, strategist at Swiss bank Pictet.

"The results from Citigroup will be key because it is probably the most exposed to risky assets among the large banks."

Across Europe, Britain's FTSE .FTSE fell 0.3 percent, Germany's DAX .GDAXI gained 0.1 percent and France's CAC .FCHI fell 0.4 percent. Depressing the tone was a Wall Street Journal report that embattled Freddie Mac (FRE.N: Quote, Profile, Research, Stock Buzz) may sell as much as $10 billion in new shares to investors. [nSP85222]

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