(by M. Riley)

European stocks declined on Credit Suisse Group and British Sky Broadcasting Group Plc.

The FTSE Eurotop 300 was down 0.5 per cent in early trade, at 978.87, while the Xetra Dax shed 0.9 per cent to 3,842.56. In Paris, the CAC-40 was 0.6 per cent lower 3,627.84 and London’s FTSE 100 fell 0.5 per cent to 4,406.3.

Credit Suisse was down 6.3 per cent to SFr39.75 despite beating expectations with a $1.14bn net profit in the second quarter. The bank said it was confident of improving full-year results, but warned of rising costs associated with the restructuring of its investment banking business.

BSkyB, Rupert Murdoch’s U.K. pay-television company, dropped 7.6 percent to 556.5 pence after saying it plans to boost spending by 450 million pounds ($819 million) over the next four years to expand the business.

BSkyB reported fiscal fourth-quarter net income that dropped 49 percent to 79 million pounds ($144 million) because it didn’t repeat a tax credit. The company set a target of 10 million digital-TV subscribers in 2010 and said it will return cash to shareholders in addition to ordinary dividends.

Commerzbank of Germany announced second-quarter profits which met expectations, but a decline in trading profits was only offset by one-off disposal gains after the sale of its stake in Spanish bank Santander. Commerzbank warned of difficult trading conditions in the second half and the shares fell 3 per cent to €13.52.

Chipmakers were a weak feature of the market following downgrades of key stocks in Europe by UBS. The broker reduced its ratings on both Infineon of Germany, and Paris-listed STMicroelectronics to “reduce” from “neutral”. Shares in Infineon fell 2.5 per cent to €8.68, while those of STMicro shed 2.2 per cent to €14.90.

A similar picture emerged in the wider sector. Philips, the Dutch electronics giant, was down 1.3 per cent to €19.48, while ASML, the maker of chip manufacturing equipment lost 2 per cent to €11.15.

BASF, the German chemicals company, reported a 44 per cent rise in second-quarter earnings, beating forecasts, as restructuring efforts payed off. The company raised its outlook for the full year, as it expected demand to remain high in the second half. But the shares were 0.3 per cent lower at €44.55.

Adidas-Salomon AG, the world’s No. 2 sporting-goods maker, gained 1.9 percent to 102.07 euros as it boosted its profit forecast, saying it expects to increase full-year earnings 20 percent, up from an earlier target of as much as 15 percent, on rising demand. The company said second-quarter net income advanced to 44 million euros, higher than the 37 million-euro median estimate of nine analysts