European shares fall for fifth day; banks down

* FTSEurofirst 300 down 0.6 pct

* Banks fall after Hungarian debt sales

* Goldman Sachs earnings awaited before Wall St opens

* Cable&Wireless Worldwide falls after cutting forecast

By Brian Gorman

LONDON, July 20 (Reuters) - European shares extended a slide into a fifth day on Tuesday, with banks falling after a spat between Hungary and international lenders hit its latest debt auction, ahead of results from U.S. peer Goldman Sachs (GS.N).

At 1104 GMT the pan-European FTSEurofirst 300 .FTEU3 index was down 0.6 percent at 1,000.09 points.

The index is down more than 10 percent from a mid-April peak on worries about debt levels in Europe and the strength of economic recovery, but is up nearly 55 percent from its lifetime low of March 9, 2009.

"IBM was the first company to be showing it is suffering from the impact of the the (stronger) dollar, which a lot of people were neglecting," said Heino Ruland, strategist at Ruland Research, in Frankfurt.

"But what is bad for the United States is good for Europe, which will surprise on the upside.

"We're going to be in a trading range. If we're not going to get the numbers to boost the markets in the current reporting season, we're going to have to wait another three or four months." Across Europe, Britain's FTSE 100 .FTSE, Germany's DAX .GDAXI and France's CAC-40 .FCHI fell between 0.6 and 1.1 percent.

Banks featured among the worst performers. BNP Paribas (BNPP.PA), Barclays (BARC.L), Societe Generale (SOGN.PA) and UniCredit (CRDI.MI) fell between 1.3 and 2.5 percent.

Weighing on the sector was news Hungary had cut its 3-month discount Treasury bill offer by 10 billion forints, pushing the yield out by 19 basis points from a week ago after talks with international lenders were suspended at the weekend.

Hungary sold 35 billion forints worth of 3-month bills on Tuesday, lower than its original offer of 45 billion, with bids totalling 52.55 billion, the Government Debt Management Agency said.

Elsewhere in the sector, Handelsbanken (SHBa.ST) fell 3.1 percent as the Swedish lender's quarterly earnings lagged forecasts after higher funding costs more than offset a reduction in bad loans. [ID:nLDE66E0V5]

NOKIA RISES

Among individual companies, Nokia (NOK1V.HE) rose 4.2 percent after a report in the Wall Street Journal suggested the company might soon replace its chief executive. [ID:nN19224002]

Most others headed lower, however, led by British telecom Cable & Wireless Worldwide (CWP.L), which plunged 17.4 percent after it said business had been hit by a significant slowdown in UK public sector business following the government's emergency budget in June. [ID:nLDE66J09A]

IT services group Logica (LOG.L) fell 6.1 percent, one of several companies to suffer after Cable & Wireless Worldwide's warning, and IBM's earnings.

Europe's largest biotech, Actelion (ATLN.VX), rose 4 percent when it confirmed its 2010 outlook after stronger-than-expected sales of its key heart and lung drug Tracleer, even though its quarterly profit lagged forecasts.

Results from Goldman Sachs, due before Wall Street opens, will help investors gauge the health of the banking sector after peers Bank of America (BAC.N), JPMorgan (JPM.N) and Citigroup (C.N) beat analysts' earnings forecasts last week but struggled to maintain overall revenues. [ID:nN16100246]

U.S. stocks rose overnight, but shares in tech firms International Business Machines and Texas Instruments TXN.N fell after the market close as their revenue growth disappointed markets. [ID:nN19191611] [ID:nN19215910]

Futures for the Dow Jones DJc1, S&P 500 SPc1 and Nasdaq NDc1 were down between 0.8 and 0.9 percent. (Editing by Simon Jessop)