* To expand into two new markets
* To grow in power production, energy trading outside Europe
* Reiterates earnings expectations for 2010
* Shares indicated down 0.7 percent, Dax seen down 0.2 percent
(Adds company comment, background)
DUESSELDORF, Germany, Nov 10 (Reuters) - Germany's E.ON, the world's largest utility, plans to expand its power generation business to two new markets outside Europe and energy trading globally as growth on the continent stalls.
The triple whammy of slumping demand, declining power and gas prices as well as the prospect of higher taxes in markets such as Germany has made the industry the worst performing sector in Europe for the second year in a row.
Having expanded into Russia and the United States, the Duesseldorf-based power provider is planning to give more weight to markets outside Europe, a strategy that has also helped competitors such as GDF Suez and Enel.
A person with knowledge of the matter had told Reuters on Tuesday that south-eastern Asia was one of the regions E.ON was considering entering.
Chief Executive Johannes Teyssen, at the helm of the company since May, plans to lay out details of his strategy for the company later on Wednesday, but still has to work out key details of the road ahead.
"We are analysing which markets we'll target and will decide that soon," said a spokesman on Wednesday, declining to be more specific.
E.ON expects earnings to decline for the next three years straight, people with knowledge of the matter told Reuters on Tuesday, disappointing current market forecasts.
The expectations of the company will further hit perceptions of the sector as a whole. (Reporting by Peter Dinkloh and Tom Kaeckenhoff; Writing by Peter Dinkloh; Editing by Jon Loades-Carter)