LONDON, July 23 (Reuters) - Britain's top shares fell sharply on Monday, extending the previous session's losses in a broad-based sell-off, on mounting concerns Spain might require a full sovereign bailout.

  Murcia on Sunday became the second Spanish region after Valencia to say it would tap a government programme to keep its finances afloat, while media reported half a dozen governments were ready to follow the two regions.

  The FTSE 100 was down 49.98 points, or 0.9 percent, at 5,601.79 by 0708 GMT, having fallen 1.1 percent on Friday on worries Spain could be forced to follow Greece, Portugal and Ireland to seek international help.

  " Greece is not far from leaving the euro which is not as big a deal as it was one year ago, but Spain was not as much a worry a year ago and is an enormously big deal today," said Lex van Dam, hedge fund manager at Hampstead Capital, which manages $500 million of assets.

By Caroline Valetkevitch

  NEW YORK, July 22 (Reuters) - The trend of better-than-expected earnings will be put to the test this week when investors hope Apple can exceed already high expectations and Facebook reports its first quarterly earnings.

  Apple accounts for a significant proportion of the overall earnings of Standard & Poor's 500 components. S& P 500 earnings are expected to show a rise of 5.7 percent in the second quarter from a year ago. Excluding the maker of the iPad, the rise is 4.8 percent, according to Thomson Reuters data.

  Apple's results, due Tuesday, could help stocks build on last week's gains and counter investor worries over the euro zone crisis. More signs of financial stress in Spain on Friday caused stocks to give back some of the week's increase. The S& P 500 ended 0.4 percent higher last week.

  " Apple can drive the whole (tech) group," said Daniel Morgan, who helps manage about $3.5 billion at Synovus Trust Company in Atlanta.

  " There's a huge psychological component as it relates directly to Apple. If they just blast numbers like they did last quarter, then obviously the perception will be everybody else did pretty good and Apple did fabulous."

  Apple's expected strong performance is mainly why technology earnings growth has held up better than other S& P 500 sectors. The expected growth rate for the sector has gone from 6.9 percent in April to 8.7 percent as of Friday, the data showed.

  Apple's earnings for the quarter are seen at $10.38 a share, based on Thomson Reuters I/B/E/S, which includes estimates from 43 analysts. That compares with a profit of $7.79 a share for the year-ago quarter.

  Morgan said Apple's growth has largely depended on the success of its new products. " For the stock, to continue its trajectory at the pace it has, it's critical that they release these new products," he said. Apple's shares are up 49.2 percent for the year so far.

  Apple does not give any clues on its future products, but the California company is widely expected to release its next-generation iPhone later this year. Wall Street has also set its heart on Apple launching a new " mini iPad" and the long-awaited television set in the near future.

  Investors are likely to be just as keen to hear from Facebook when it reports on Thursday. Facebook's first results following its market debut could give investors another chance to indicate how they feel about the stock since its disappointing initial public offering.

  Shares of Facebook, one of the most closely watched IPOs ever, lost ground after technical problems with its market debut on Nasdaq and as investors questioned its ability to rapidly increase advertising revenue.

  Analysts said an earnings miss by Facebook could be disastrous for the stock, which closed Friday at $28.76, below its $38 offering price.

  Investors are looking for executives to address a litany of concerns about the business, such as the efficacy of its online ads and the company's nascent efforts in mobile advertising.

  Tech results also will be closely watched for signs of weak demand overseas, particularly from Europe. Other technology companies expected to report this week include Texas Instruments and Amazon.com. Of the S& P sectors, technology has the highest sales exposure to Europe at about 25 percent, according to a Bank of America/Merrill Lynch research note.

  Among the other 138 S& P 500 companies reporting earnings are Ford Motor Co, United Parcel Service and Whirlpool Corp.

  While the majority of companies have beaten earnings expectations, revenue performance has been the worst for S& P 500 companies since the first quarter of 2009.

  With results in from 116 companies, just 43 percent of companies are beating revenue expectations.

  Sixty-seven percent of companies are beating earnings estimates, compared with a long-term average of 62 percent, Thomson Reuters data showed.

  " With global growth slowing down, it's not surprising we're going to see some mixed numbers on the revenue side," said Natalie Trunow, chief investment officer of equities at Calvert Investment Management in Bethesda, Maryland, whose firm manages about $13 billion in assets.

  While earnings are expected to dominate stock investors' attention in the coming week, the euro zone crisis is still capable of taking the spotlight.

  " It's the default thing for people to focus on," said Eric Kuby, chief investment officer at North Star Investment Management Corp. in Chicago.

  Spain will tap the markets Tuesday when it sells three- and six-month bills. It will also sell three- and five-year bonds on Aug. 2. Spain's 10-year bond yields hit a euro-era high of 7.3 percent on Friday.

  The week's U.S. economic data includes the Markit U.S. Manufacturing Purchasing Managers Index for July, due on Tuesday. June's reading marked the lowest showing since December 2010.

NEW YORK (Reuters) - U.S. stocks fell on Friday as Europe's debt crisis flared up again on fears Spain may eventually need a bailout, prompting traders to cash in three days of gains.

  Based on the latest available data, the Dow Jones industrial average was down 120.79 points, or 0.93 percent, at 12,822.57. The Standard & Poor's 500 Index was down 13.85 points, or 1.01 percent, at 1,362.66. The Nasdaq Composite Index was down 40.60 points, or 1.37 percent, at 2,925.30.

* European shares consolidate below 4-month highs

  * Euro near record low vs A$, down 0.2 pct vs dollar

  * Spanish 10-year bond yields hover near 7 pct

  * Oil prices ease after hitting 8-week high overnight

  LONDON, July 20 (Reuters) - European shares edged away from four-month highs and the euro dipped on Friday with concern focused on Spain's fiscal position despite the expected approval of its bank bailout plan later in the day.

  Oil prices also eased after hitting an eight-week peak on supply concerns linked to rising Middle East tension, but the rally in soft commodities, which has seen corn and soybean prices soar to record highs, showed no signs of abating.

  The FTSEurofirst 300 index of top European companies was down 0.3 percent at 1,061.44 in early trade, after closing at its highest level since early April on Thursday, helped by a robust start to second quarter earnings season.

  Gradual moves by euro zone authorities to tackle the region's debt crisis and hopes central banks will ease policy to boost global growth have also improved sentiment in equity markets since the beginning of June.

  " I do see profit taking coming in sooner rather than later. I don't see how the UK and European markets can keep ignoring Spanish bond yields at above seven percent," said JN Financial senior trader Adrian Redmond.

  The euro fell 0.2 percent against the dollar to $1.2253 , staying above a two-year low of $1.2162.

  Euro zone finance ministers are expected to finally sign off on a deal to bail out Spain's banks with up to 100 billion euros but the exact amount will probably not be known until September.

  The impending bank bailout was not having much impact on Spanish bonds, with the 10-year debt yield remaining near an unsustainable high 7.0 percent level although a rise in financial stocks lifted Spain's IBEX by 0.2 percent, bucking the trend elsewhere in the region.

HELSINKI (Reuters) - Finland's parliament approved a rescue package for Spanish banks, despite criticism from opposition parties who are against euro zone bailouts.

  A total of 109 lawmakers supported the bailout, while 73 opposed it and 17 were absent from Friday's vote.

  Finland earlier secured a deal with Spain to receive collateral in exchange for the loans, an agreement modelled on an earlier deal with Greece.

  (Reporting by Terhi Kinnunen Editing by John Stonestreet)

By Benjamin Kang Lim

  BEIJING (Reuters) - Impoverished North Korea is gearing up to experiment with agricultural and economic reforms after young leader Kim Jong-un and his powerful uncle purged the country's top general for opposing change, a source with ties to both Pyongyang and Beijing said.

  The source added that the cabinet had created a special bureau to take control of the decaying economy from the military -- one of the world's largest -- which under Kim's father was given pride of place in running the country.

  The downfall of Vice Marshal Ri Yong-ho and his allies gives the untested new leader and his uncle Jang Song-thaek, who married into the Kim family dynasty and is widely seen as the real power behind the throne, the mandate to try to save the battered economy and prevent the secretive regime's collapse.

  The source has correctly predicted events in the past, including North Korea's first nuclear test in 2006 days before it was conducted as well as the ascension of Jang.

  The changes could herald the most significant reforms by the North in decades. Previous attempts at a more market driven economy have floundered, most recently a drastic currency revaluation in late 2009 which triggered outrage and is widely believed to have resulted in the execution of its chief proponent.

  " Ri Yong-ho was the most ardent supporter of Kim Jong-il's 'military first' policy," the source told Reuters, referring to Kim Jong-un's late father who plunged the North deeper into isolation over its nuclear ambitions, abject poverty and political repression.

  The biggest problem was that he opposed the government taking over control of the economy from the military, the source said, requesting anonymity to avoid repercussions.

  North Korea's state news agency KCNA had cited illness for the surprise decision to relieve Ri of all his posts, including the powerful role of vice chairman of the ruling party's Central Military Commission, though in recent video footage he had appeared in good health.

  Ri was very close to Kim Jong-il and had been a leading figure in the military. Ri's father fought against the Japanese alongside Kim Jong-il's late father Kim Il-sung, who founded North Korea and is still revered as its eternal president.

  The revelation by the source was an indication of a power struggle in the secretive state in which Kim Jong-un and Jang look to have further consolidated political and military power.

  Kim Jong-un was named Marshal of the republic this week in a move that adds to his glittering array of titles and cements his position following the death of his father in December. He already heads the Workers' Party of Korea and is first chairman of the National Defence Commission.

  The North Korean Embassy in Beijing, reached by telephone, declined to comment.

  REFORMS

  North Korea's cabinet has created a " political bureau" which will wrest power from the 1.2 million-strong military to run the economy which has been in shambles after a crippling famine in the 1990s, the source said.

  " In the past, the cabinet was empty with no say in the economy. The military controlled the economy, but that will now change," the source said.

  Kim Jong-un has set up an " economic reform group" in the ruling Workers' Party to look at agricultural and economic reforms, the source said, adding that North Korea will learn from its giant neighbour and solitary benefactor, China.

  Beijing leaders are thought to have been pressing Pyongyang to do more to reform the economy, worried that a collapse of the North could send refugees streaming across its border and the loss of a strategic buffer to South Korea and the large contingent of U.S. troops which help protect it.

  It was unclear who will head the cabinet's " political bureau" and the party's " economic reform group" , but change was inevitable, the source said.

  In sharp contrast to the austere, reclusive image of his father, state media have shown Kim Jong-un visiting fun fairs, speaking in public and applauding at a rock concert at the weekend.

  Women appear to have been more freedoms, including wearing short skirts, although 200,000 people are in prison camps in the impoverished and isolated country.

  The source dismissed speculation of any political fallout from the purge, saying: " Kim Jong-un and Jang Song-thaek are in control of the military."

  Jang has long been seen as a proponent of reform of an economy which through mismanagement has entirely missed out on the fruits of dramatic growth of neighbours like China and South Korea.

  His push for reform was widely seen as having triggered a period of exile but he was later rehabilitated and given the primary role of supporting Kim Jong-il's son when he was being groomed to eventually take over the leadership.

  North Korea has yet to name Ri's replacement as head of the army, the source said.

  It was unclear how many of Ri's men have been sacked, but the source said they have not been jailed. An assessment of the changes by the South Korean government seen by Reuters, said that some 20 top officials had been purged since Kim Jong-un began his ascent to power.

  (Editing by Jonathan Thatcher)

TOKYO, July 20 (Reuters) - Japan's Nikkei share average tumbled 1.4 percent on Friday as investors took profits after better-than-expected stateside earnings failed to dispel pessimism about a creaking global economy on the back of disappointing U.S. data. The Nikkei closed at 8,669.87, while the broader Topix index sank 1.8 percent, its biggest loss in six weeks, to 733.82.

* Fight for APB comes amid global industry consolidation

  * Asia a key revenue driver for Heineken

  * All eyes on whether Thai group may raise $3 bln offer (Adds F& N, APB shares)

  By Saeed Azhar and Eveline Danubrata

  SINGAPORE, July 20 (Reuters) - Heineken NV launched a S$5.1 billion ($4.1 billion) counter-bid for Asia Pacific Breweries (APB) on Friday, trumping a surprise offer for the maker of Tiger Beer by a Thai billionaire and setting the stage for a two-way battle.

  The fight for APB comes amid a wave of industry consolidation and steady growth for emerging-market beer sales. The S$3.8 billion ($3.03 billion) bid for stakes in APB and Singapore food and beverage conglomerate Fraser and Neave (F& N) by companies linked to Charoen Sirivadhanabhakdi would give his beer empire more exposure to Southeast Asian markets and eclipses all previous overseas deals by a Thai group.

  Heineken, the world's No.3 brewer, reacted quickly to the Thai intrusion earlier this week. Asia is a key revenue driver for the Dutch brewer at a time of sluggish growth in the Americas and declining sales in its home market of Western Europe.

  " People were expecting something from either Heineken or Kirin, but how fast Heineken moved is the surprising thing," said Andrew Chow, head of research at UOB-Kay Hian in Singapore.

  F& N owns 40 percent of APB, while Heineken already holds 42 percent of the beer maker, a stake that it treasures given Asia's fast-growing beer market. Japan's Kirin Holdings owns a 14.7 percent stake in F& N.

  Heineken said it would acquire F& N's direct and indirect stakes in APB, one of the biggest Asia-Pacific breweries, putting a S$50-per-share bid on the table. That tops a S$45-a-share offer for APB proposed by a company linked to Charoen.

  F& N and APB suspended trading of their shares after the Heineken offer. F& N and the beer maker last traded at S$7.60 and S$42, respectively.

By Jessica Jaganathan

  SINGAPORE, July 20 (Reuters) - Singapore authorities have seized a fuel oil tanker operated by financially troubled FAL Oil Company due to its failure to pay Germany's DVB Bank around $3 million in debt, two industry sources familiar with the matter said on Friday.

  United Arab Emirates-based FAL Oil, which was blacklisted by Washington in January for its links to Iran, has until the end of next week to contest the step and prevent the Khorfakkan tanker being handed over to DVB Bank.

  Singapore's Supreme Court Sheriff's Office seized the 105,000-deadweight tonne clean tanker on July 18, but allowed the 80,000-tonne fuel oil cargo to be discharged to its owner ChinaOil, the trading arm of PetroChina, a Singapore-based industry source said.

  " The tanker was seized because of an outstanding debt of $2.84 million that was initially due in late May," said the source, who asked not to be named as he is not authorized to speak to the media.

  " The company has eight days to decide whether to contest the claim or allow the bank to foreclose on the property."

  DVB Bank declined to speak on the matter, while FAL Oil could not be reached for comment.

  In April, sources told Reuters that the company was close to securing an agreement to restructure about $700 million of its debt with creditors that would include additional loans to keep its operations going.

  FAL Oil used to be one of the largest fuel oil players in the Middle East, but has struggled to keep its business operations in full swing due to a lack of funds.

  It was forced to cut its fuel oil and bunkering business in the UAE by as much as 60 percent. The company also shut its trading operations in Singapore and London.

  Washington sanctioned the independent energy trader earlier this year for its role in supplying gasoline into Iran.

  FAL Oil was also blacklisted by the Pakistan State Oil Company (PSO) in October last year after failing to meet its contractual agreements, which resulted in a disruption to supplies of fuel oil. (Additional reporting by Randy Fabi, Luke Pachymuthu, and Lee Yen Nee Editing by Manash Goswami and Joseph Radford)

LONDON, July 20 (Reuters) - Europe's top shares fell on Friday but remained on course for a seventh straight week of gains as expectations of further stimulus measures in the United States and robust corporate earnings offset a weak macroeconomic outlook.

  By 0704 GMT, the FTSEurofirst was down 3.03 points, or 0.3 percent, at 1,061.44, after closing at its highest level since early April, albeit in low volumes, on Thursday, and having bounced from a 14.5 percent fall from mid-March to the start of June.

  Recent reports from the International Monetary Fund on the UK and euro zone economies has painted a particularly bearish macro picture and kept alive hopes of further quantitative easing.

  A fairly robust start to the earnings season has also helped, with roughly 15 percent of those due to do report having done so, beating consensus estimates by around 6 percent, Thomson Reuters Starmine data showed, albeit from watered down expectations.

  " That is the cocktail (that is driving the indexes) it is somewhere between more monetary easing ... and earnings where there has been a few pleasant surprises," Richard Hunter, head of equities at Hargreaves Lansdown, said.

  Hunter said market momentum could be maintained even if the U.S. Federal Reserve -- the last main central bank yet to embark on a fresh round of stimulus -- fails to give the market what it wants in the form of more quantitative easing because the justification for that would be improving economic data, which would in turn be a lift to sentiment.