Nov. 5 (Bloomberg) -- European stocks fell for a third day after Citigroup Inc. said it may write down an additional $11 billion, raising concern financial companies face more credit- market losses.

Societe Generale SA, Credit Suisse Group and Barclays Plc led banks lower after analysts downgraded the stocks. J Sainsbury Plc tumbled 21 percent as Qatar's Delta (Two) Ltd. dropped plans for a 10.5 billion-pound ($21.9 billion) takeover, citing a worsening debt market.

``It looks like there may be more bad news to come,'' said Simon Carter, who helps oversee $3 billion at Aegon Asset Management in Edinburgh. ``The Citigroup writedown due to subprime was much larger than expected. Sainsbury's woes are also not helping.''

The Dow Jones Stoxx 600 Index lost 0.7 percent to 377.32. The measure has dropped 2.9 percent in three days on concern that more banks may follow Citigroup and Merrill Lynch & Co. in increasing their estimates of losses related to subprime mortgages.

Citigroup said yesterday Chief Executive Officer Charles Prince is stepping down after the largest U.S. bank warned of more writedowns, on top of more than $6 billion of charges reported for the third quarter. Merrill CEO Stan O'Neal was ousted on Oct. 30, less than a week after reporting the biggest quarterly loss in the 93-year history of the world's largest brokerage.

UBS AG Chairman Marcel Ospel may be ousted should the bank's losses from the collapse of the U.S. subprime mortgage market increase, Sonntag reported yesterday, without saying where it got the information.

National Markets

Benchmarks fell in all of the 18 western European markets except Sweden, Denmark and Spain. The U.K.'s FTSE 100 lost 1.1 percent. France's CAC 40 declined 0.6 percent and Germany's DAX dropped 0.5 percent. The Stoxx 50 decreased 0.5 percent, while the Euro Stoxx 50, a measure for the euro region, slid 0.4 percent.

UBS, Europe's largest bank by assets, sank 3.7 percent to 54.6 francs. The company's board has set a limit for losses of 10 billion Swiss francs ($8.7 billion), Sonntag said in its report on Ospel.

Credit Suisse, Switzerland's second-largest bank, lost 1.7 percent to 71.25 francs. Societe Generale, the second-biggest French bank by market value, fell 2.1 percent to 106.34 euros. Bear Stearns Cos. cut its recommendation on the stocks to ``peer perform'' from ``outperform.''

``The outlook for revenues in the industry looks tough in 2008,'' Christopher Wheeler wrote in a note today. ``Hence, further risks to earnings in 2008 remain high.''

Sainsbury

Barclays, which makes more than a third of pretax profit from securities trading, fell 3 percent to 521.5 pence. HSBC Holdings Plc downgraded the stock to ``underweight'' from ``neutral.''

HBOS Plc, the U.K.'s No. 1 mortgage lender, was lowered to ``underweight'' from ``overweight'' at HSBC. The shares dropped 1.8 percent to 810 pence.

Sainsbury sank 115 pence to 440 pence. Delta dropped takeover plans after saying the ``deterioration'' of credit markets made it too expensive to buy Britain's third-largest supermarket company.

European Aeronautic, Defence & Space Co. retreated 3.8 percent to 22.01 euros after saying it will book expenses of as much as 1.4 billion euros ($2 billion) because of delays to the delivery schedule for its A400M military transport plane.

BSkyB, Ladbrokes

EADS has withdrawn its forecast for full-year earnings before interest and tax and will give a new outlook on Nov. 8, it said today in an e-mailed statement.

Mining stocks followed metal prices lower. BHP Billiton Ltd., the world's largest mining company, dropped 3.1 percent to 1,700 pence. Rio Tinto Group, the world's third-largest, decreased 3.9 percent to 4,197 pence.

Copper fell for the sixth session in a row, the longest slump since August 2004, on speculation that rising inventories signaled easing demand. Nickel and zinc also dropped.

British Sky Broadcasting Group Plc fell 3.6 percent to 636 pence after the U.K.'s biggest pay-television broadcaster was cut to ``neutral'' from ``buy'' at Merrill Lynch, pending the publication of a regulatory report on television competition.

``The outcome of Ofcom's review of the pay-television market is not without risks, which could weigh on the shares,'' analysts including Julien Roch said in a note dated today.

Ladbrokes Plc dropped 2 percent to 393.5 pence. William Hill Plc slid 1.5 percent to 592.5 pence. Analysts at Morgan Stanley downgraded the stocks, saying growth at U.K. bookmakers will slow as revenue from international expansion takes longer than estimated and costs rise.

Ryanair

Ladbrokes was cut to ``underweight'' from ``equal-weight,'' and William Hill reduced to ``equal-weight'' from ``overweight'' by analysts including Vaughan Lewis in a note to investors.

Ryanair Holdings Plc retreated 4 percent to 5.52 euros. Europe's biggest discount airline said a decline in ticket prices will drive down earnings in the fiscal third quarter.

Wavin NV tumbled 11 percent to 9.93 euros. Europe's biggest maker of plastic pipes for sewers had a record drop in Amsterdam trading after the company lowered its annual sales forecast.

To contact the reporter on this story: Sarah Thompson in London at sthompson17@bloomberg.net.

Last Updated: November 5, 2007 12:04 EST