London: European stocks dropped as a $61 billion (Dh224 billion) bailout plan for Greece failed to allay investors' concerns that levels of sovereign debt across the region may derail economic recovery. Asian shares and US index futures were little changed.

Eurazeo SA dropped 4.7 per cent after Les Echos reported the company is considering raising about 500 million euros in a rights offer. National Bank of Greece SA climbed 6.2 per cent, sending the benchmark index for Greek stocks higher.

UBS AG gained 3.3 per cent after the Swiss bank reported the highest quarterly earnings in almost three years.

Rescue plan

The Stoxx Europe 600 Index slid 0.2 per cent to 269.22 at 2.16pm in London after swinging between gains and losses at least 10 times. The gauge has climbed six per cent in 2010 as the European Union agreed a contingency rescue plan to help Greece tackle the region's biggest budget deficit.

"Greece has certainly been on everyone's minds," London-based David Hussey, head of European equities at MFC Global Investment Management, which manages about $287 billion in assets, said.

"Looking further out you've got to be worried that a similar situation could happen later in the year" elsewhere. Futures on the Standard & Poor's 500 Index expiring in June were little changed, as was the MSCI Asia Pacific Index.

Eurazeo dropped 4.7 per cent to 52.20 euros in Paris, the worst performer on the Stoxx 600, after French daily Les Echos reported the investment company is considering raising about 500 million euros in a rights offer to use for acquisitions.

The newspaper cited four unidentified people. The company declined to comment, Les Echos said.

Unicredit AG's chief strategist, Thorsten Weinelt, warned that the outlook for European stocks will "slowly but steadily" worsen.

"European equities are prowling in the midst of a transition period, moving from a strong uptrend towards a multi-month sideways/correction phase," the Munich-based strategist wrote in a report to clients. "Risk factors will gain an increasing influence over time."

Strategists including Societe Generale SA's Alain Bokobza also said UK may be the weak spot of European markets after Greece was offered a bailout over the weekend.

UK's budget shortfall reached 11.8 per cent of gross domestic product in the past fiscal year, near Greece's deficit of 12.9 percent of GDP last year.