Speedy Hire Share News (SDY)

* FTSE 100 down 0.4 pct

* Fresnillo jumps pct on Goldman upgrade

* Smurfit Kappa rejects revised International Paper bid

* JD Sports rises on Finish Line takeover

* Speedy Hire jumps after results(Recasts, adds detail, closing prices)

By Helen Reid and Danilo Masoni

LONDON, March 26 (Reuters) - British shares fell on Monday,reversing earlier gains and joining a broader pull-back inEurope where diplomatic tensions with Russia helped more thanoffset easing trade war fears.

The FTSE 100 fell 0.4 percent to 6.888.7 points, itslowest closing level in 15 months and staying below the key7,000 points mark for the third day running.

The index had earlier risen as much as 0.5 percent followinga report that the U.S. has contacted China seeking measures toreduce their trade imbalance.

Then the United States said it would expel 60 Russiandiplomats, joining governments across Europe punishing theKremlin for a nerve agent attack on a former Russian spy inBritain that they have blamed on Moscow.

Strength in the pound, which rose against the dollar ongrowing confidence that the Bank of England would raise interestrates in May, also did not help.

Big international companies such as GlaxoSmithKline,Experian and BAT fell between 0.6 and 2.1percent. Consumer staples and materials weighed the most, wipingoff a combined 17 points from the index.

Top FTSE loser was Smurfit Kappa, which fell 4.1percent after the firm spurned a renewed offer fromInternational Paper.

Having jumped to a record high on news of the takeoverapproach early this month, Smurfit's shares are now down morethan 7 percent from that peak.

Fresnillo was the biggest gainer, up 4.5 percentafter Goldman Sachs analysts upgraded the stock to "buy" andadded it to their "conviction list", based on their bullishposition on gold.

"Our commodities team is bullish on gold for the first timein more than five years based on higher inflation, rising EMwealth and concerns about an equity correction," wrote Goldmanstrategists, upgrading the whole gold mining sector.

Randgold Resources also gained 1.1 percent after theGoldman upgrade to "buy".

Among mid-caps, JD Sports fell 4.7 percent afteragreeing to buy Finish Line, one of the largest retailers ofathletic footwear and apparel in the United States, for $558million.

Inchcape rose 2.2 percent after saying it would buyGrupo Rudelman, an auto distribution business in CentralAmerica.

Dana Inc increased its cash offer for GKN by$140 million, ramping up its efforts to fend off rival suitorMelrose. GKN shares rose 0.6 percent.

Tools and equipment hire company Speedy Hire rose8.1 percent after saying full-year profits were likely to beahead of expectations.

Overall, analysts are downgrading their estimates for FTSE100 earnings, and the leading UK index has underperformedEuropean peers over the past 12 months.

(Reporting by Helen ReidEditing by David Stamp and Andrew Heavens)