* STOXX 600 falls 0.6 pct, weighed by weaker auto stocks
* Fiat plummets on US accusation of excess diesel emissions
* Miners help UK's FTSE thinly extend record winning streak
* Drugmakers bruised by Trump drug prices barb
* Jeweler Richemont surged on well-received update
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By Danilo Masoni
MILAN, Jan 12 European shares fell on Thursday
weighed down by Fiat Chrysler, which wiped out one sixth of its
value in a late session slide after the U.S. accused the car
maker of excess diesel emissions, raising worries of heavy
The STOXX 600 fell 0.7 percent with the auto sector
index leading sectoral fallers, dragged down by 16.1
percent slump in Fiat Chrysler shares, the biggest faller on the
pan-European benchmark index.
In spite of the auto woes and continued losses among pharma
stocks on worries over pricing pressure in the U.S., Britain's
blue chip FTSE 100 index inched up 0.03 percent, thinly
extending to 13 days its record winning streak.
The U.S. Environmental Protection Agency accused Fiat
Chrysler of using software that allowed excess emissions in
104,000 U.S. vehicles sold since 2014. The group led by Sergio
Marchionne said it was it is "disappointed" with the EPA
"It's no surprise that another big auto maker is implicated
for this was always going to be much bigger than just Volkswagen
...Fines and costs could be crippling if Volkswagen's experience
is anything to go by," Neil Wilson, market analyst at ETX
Capital said in a note.
A Milan-based trader says the market may conceive
liabilities of around $3 billion, or 20 percent of Fiat's market
value, assuming this case is similar to the one that hammered
the German carmaker more than one year ago.
Fiat's 16 percent drop was its biggest ever and came as the
stock was close to hitting a fresh record high. The auto index
fell 2.8 percent while elsewhere in the sector Germany's
BMW and Daimler and France's Renault
all fell more than 2.6 percent.
"One thing is now clear - this scandal goes well beyond VW
and Fiat Chrysler's involvement raises the possibility that
other big carmakers are involved," Wilson added.
Europe's healthcare sector index fell 1.9 percent
after U.S. President-elect Donald Trump targeted
pharmaceuticals' drug pricing in a press conference.
Trump on Wednesday commented on the issue of competitive
drug pricing, saying pharmaceutical companies were "getting away
with murder" by charging high drug prices.
Italy's UBI Banca was top gainer of the STOXX, up
9.1 percent on news the bank would buy three rescued Italian
banks through a 400 million euro share issue.
Swiss luxury goods group Richemont was also a top
European gainer, its shares jumping 8.6 percent after its
trading update indicated a pick-up in demand for watches and
jewellery. Peer Swatch gained 5.4 percent.
Britain's blue-chip FTSE 100 was underpinned by gains among
basic resources and precious metals miners, which were boosted
by a weaker dollar, with Randgold Resources, Fresnillo
, and Anglo American all up more than 2 percent.
(Additional reporting by Helen Reid; Editing by Angus MacSwan)