Reuters - European stocks dipped on Wednesday, taking a breather from their sharp three-week rally, with shares in luxury goods makers under renewed pressure due to their big exposure to emerging markets.

Credit Suisse was also in the spotlight, losing 2.5 percent as a U.S. Senate subcommittee alleged new misdeeds by the Swiss lender. The bank's officials are expected to stress that only a small group of Swiss-based private bankers had helped clients evade taxes, according to a person familiar with the bank's thinking.

The FTSEurofirst 300 index of top European shares ended 0.2 percent lower at 1,348.75 points, following a 7 percent rise from a low hit on Feb. 4.

The euro zone's blue-chip Euro STOXX 50 index ended 0.3 percent lower, at 3,148.19 points.

The market's recent brisk rally - fuelled by a relatively positive earnings season and signs of a pick-up in economic growth in Europe - has propelled some regional stock indexes to major resistance levels, with both the UK's FTSE 100 and Germany's DAX trading within sight of record highs.

"Indexes in Europe are still in a bull trend, and it's very strong. But there are key resistances to be crossed. Investors should take advantage of all the dips to buy," Aurel BGC chartist Gerard Sagnier said.

Shares in luxury goods makers featured among the top losers on Wednesday, with Louis Vuitton owner LVMH down 1.6 percent and Gucci owner Kering down 2.2 percent, as traders pointed to a downbeat note from Credit Suisse analysts who downgraded the sector to 'benchmark' from 'overweight' citing its big exposure to China and other emerging markets.

"The risks of structurally slower China growth as well as the negative impact of China's anti-corruption measures on high-end spending do not yet seem to be adequately reflected in consensus expectations for luxury goods sales growth, which, at 12 percent on a 12-month forward basis, is close to the top end of its 10-year range," the analysts warned in a note.

Luxury shares - which were seen as safe havens during the heat of the euro zone debt crisis due to their strong exposure to emerging markets - have fallen out of favour among fund managers in the past few months, hurt by doubts about the pace of growth in emerging countries.

LVMH's stock is down 10 percent since mid-September, while both Hermes and Kering are down 15 percent over the same period, strongly underperforming a 7 percent rise in the FTSEurofirst 300.

French telecoms stocks also dropped on Wednesday as a price war between the country's operators heated up with Bouygues Telecom unveiling a cut-price bundle offer. Iliad sank 5.8 percent and Orange fell 3.4 percent.

Around Europe, UK's FTSE 100 index fell 0.5 percent, Germany's DAX index slipped 0.4 percent, and France's CAC 40 shed 0.4 percent.

Investors were also kept on edge by tensions in Ukraine, with volatile trading late in the European session.