* FTSEurofirst 300 down 0.8 percent; volumes light
* China rate hike weighing on shares
* Autos hit by Beijing car registrations quota cut
By Harro ten Wolde
FRANKFURT, Dec 27 (Reuters) - European stocks fell on Monday in thin trade, halting a December rally after China's decision to raise interest rates over the weekend raised concerns about the outlook for global growth. At 0919 GMT, the FTSEurofirst 300 index of top European shares was down 0.8 percent at 1,138.52 points after rising 0.1 percent in the previous session.
The index has gained 7.5 percent in December and is still on track for its biggest monthly gain since July 2009.
Sentiment was hit by China's central bank's Saturday interest rate increase, the second time in just over two months as it steps up efforts to rein in inflation.
The People's Bank of China said it would raise the benchmark lending rate by 25 basis points to 5.81 percent and lift the benchmark deposit rate by 25 basis points to 2.75 percent.
The China rate hike news had driven the market lower at the open, said Dominick Daniele, trader at City Index, although the market had since stabilised in light volumes and the next focus would be on the U.S. open.
Trading was light with UK markets remaining closed. France's CAC 40 fell 1.1 percent. Germany's DAX lost 1.2 percent.
Traders expect this week's volumes to be low as many institutional investors have closed the books for the year.
"This implies low trading volumes, like last week, bearing potential risk of large swings in either direction," traders at Close Brothers said, adding they still expect markets to post double-digit increases for the year.
Auto shares were the biggest decliners with the STOXX Europe 600 Automobiles & Parts index down 3.2 percent. Traders pointed to profit taking after Beijing announced measures to limit new car registrations to tackle congestion in the Chinese capital.
The car makers index is up 47 percent so far this year, outperforming a 9 percent higher FTSEurofirst 300. By 0900 GMT Porsche shares were down 7.2 percent, Volkswagen dipped 4.9 percent and BMW shed 4.2 percent.
Oil shares were slightly outperforming the main index with the STOXX Europe 600 Oil & Gas index down 0.6 percent after a blizzard in the U.S. Northeast more than offset uncertainty over Chinese demand to push oil to a 26-month high. (Editing by Jon Loades-Carter)