* FTSEurofirst down 0.8 pct, Euro STOXX 50 falls 0.7 pct
* Getinge slumps 10.3 percent, leads healthcare selloff
* HSBC sees Europe outperformance as economy improves
(Recasts and updates with closing prices)
By Francesco Canepa
LONDON, Oct 8 (Reuters) - European shares fell on Tuesday as a U.S. budget deadlock unnerved investors and medical technology group Getinge
The pan-European FTSEurofirst 300 index
The euro zone's blue-chip Euro STOXX 50 index
The U.S. Congress has only nine days left to raise the sovereign debt ceiling and avert a default.
"The most likely scenario is that it won't happen but for sure it 'freezes' some investors (from buying) in the very short term," said Marc Renaud, chairman of Paris-based Mandarine Gestion, which manages 1.8 billion euros ($2.44 billion).
Mandarine has cut the net equity exposure of its asset allocation fund to 37 percent currently, from 43 percent in August, using derivatives to sell European indexes at a future date. The fund's maximum net exposure is 60 percent.
Among single stocks, Getinge fell 10.3 percent to the bottom of the FTSEurofirst 300 in volume 14 times the average for the past three months after the group warned on its profits, citing delays to the benefits of an acquisition, taxes and exchange rate moves.
The stock led fallers in the STOXX Europe 600 Healthcare index
Getinge's warning followed similar moves by consumer goods group Unilever
Analysts are cutting their estimates for European companies despite better economic data for the region, a move often in response to weaker emerging market (EM) currencies. The pace of downgrades, however, has slowed in recent weeks, Datastream data showed.
"There are some specific issues such as EM currency weakness, but we expect the improving economic backdrop to drive upside (earnings) surprises from here," Daniel Grosvenor, global strategist at HSBC bank, said.
"Analysts are still revising down their estimates, but at a slower pace than previously, and that ... effect is usually positive for the market."
HSBC expects the FTSEurofirst 300 and the Euro STOXX 50 to climb about 13.5 percent to hit 1,400 points and 3,300 points by the end of 2014, respectively, outpacing the U.S. S&P 500
European shares have outperformed their U.S. counterparts since July as economic momentum in Europe improved, the U.S. monetary policy became more uncertain and, more recently, amid the threat of a U.S. default.
($1 = 0.7368 euros)
(Additional reporting by Sudip Kar-Gupta; editing by Simon Jessop, Ron Askew)
((francesco.canepa@thomsonreuters.com)(0044)(0)(2075423871)(Reu ters Messaging: francesco.canepa.thomsonreuters.com@reuters.net))
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Keywords: MARKETS EUROPE STOCKS/SETTLE
