European shares fell for the fourth straight session on Wednesday amid doubts about a return to economic growth, which hammered commodity stocks, and with banks in the red on fresh concerns about U.S. financial sector health.

The FTSEurofirst 300 index of top European shares fell 1.9 percent to 845.76 points -- its lowest close since May 15 -- but remains up 1.7 percent year-to-date.

"We've seen a couple of weak days but no radical sell-off," said Commerzbank Chief Strategist Hans-Juergen Delp, who attributed the downward move to a persistent discrepancy between upbeat sentiment indicators and weak real economy data.

"The sentiment indicators have been positive but have not been backed up by hard real economic data," he said.

"We need new impulses to kick off sustained gains but no such impulses are in sight."

Banks took the most points off the European benchmark index.

Standard & Poor's lowered its ratings and revised its outlooks on 22 U.S. banks.

"Operating conditions for the industry will become less favorable ... characterized by greater volatility in financial markets during credit cycles, and tighter regulatory supervision," S&P said, adding the changes also reflected an ongoing broad-ranging reassessment of industry risk for U.S. financial institutions.

In Europe, Allied Irish Banks tumbled 17 percent, Dexia lost 6.8 percent, Deutsche Bank and Credit Suisse both fell 4 percent, and UBS dropped 3.9 percent.

DEMAND WORRIES

London copper fell to a near two-week low as doubts about the global economic recovery renewed worries over metals demand.

Among miners, Xstrata plunged 10.2 percent, Rio Tinto lost 7.8 percent, Anglo American fell 6.3 percent and BHP Billiton was down 3.9 percent.

Steelmakers also suffered, notably ArcelorMittal, which dropped 6.4 percent to its lowest close in three weeks.

Softer oil prices hit energy stocks, with Repsol down 3.2 percent, BP down 2.4 percent and Total down 2.2 percent.

Economic data on Wednesday showed the euro zone's unadjusted exports fell 27 percent year-on-year in April and imports dropped 28 percent.

Bank of England policymakers acknowledged recent data on Britain's economy had been encouraging but stuck with gloomy projections published in May, minutes to this month's policy meeting showed.

The Swiss State Secretariat for Economic Affairs lowered its forecast for the domestic economy to contraction of 2.7 percent this year and 0.4 percent in 2010, suggesting a deeper and longer recession than so far anticipated.

U.S. package delivery company FedEx Corp gave an outlook well below Wall Street estimates, saying the next two quarters would be "extremely difficult" although there were signs that the pace of economic decline had slowed.

"The bulls have lost their swagger and after a week long stalemate, the bears appear to be winning (the) recovery debate. Financial markets have now broken out of last week's unusually tight trading range," BetOnMarkets.com said in a note.

TRIPLE-WITCHING

Some analysts have said the so-called triple witching -- the simultaneous expiry of stock index futures, stock index options and single stock options -- on June 19 could be playing a role.

Technical analysts, or chartists, at UniCredit, said that impact may have run its course by now.

"In the last five quarters, expiration effects already occurred at the beginning of the week ... we expect most of the expected pressure already to have happened," they said in an equity strategy note.

"The market is clearly missing some real inspiration," UniCredit said, citing turnover on the New York Stock Exchange, the trend of which European equity markets tends to follow.

The day's European gainers were mainly in traditional defensive sectors such as telecommunications and healthcare. In telecommunications, Vodafone added 3.7 percent, Deutsche Telekom put on 2.1 percent and France Telecom rose 1.6 percent.

Among healthcare stocks, AstraZeneca was up 2.5 percent and Sanofi Aventis rose 1.5 percent.

It was thin on the corporate news front, but some companies made waves.

Sainsbury fell 5.7 percent after Britain's third-biggest grocer said it would raise about $700 million to accelerate its expansion.

"The market isn't buying the capital raising and expansion plans," ETX Capital said in a note.

"Analysts are concerned that the UK grocery market is developing into a `barbell' shape, with giant Tesco at one end and low-cost retailers like Morrison's and Asda (part of U.S. WalMart) at the other. Sainsbury's, in this analysis, looks uncomfortably stuck in the middle," ETX Capital said.

Shares in K+S fell 14 percent after the German fertiliser and salt maker warned of a bigger drop in earnings and sales this year than previously forecast, as farmers continue to hold off on potash orders.