* FTSE 100 falls on profit-taking, risk aversion up
* Banks weak; Lloyds Banking falls on report of cash-raising
* Defensives, retailers gain
By Harpreet Bhal
LONDON, Sept 2 (Reuters) - Britain's leading share index shed 0.8 percent in early trade on Wednesday, as jitters over the sustainability of the summer rally gathered pace, hitting banks and miners.
By 0810 GMT, the FTSE 100 lost 36.48 points at 4,783.22 extending sharp falls from Tuesday, weighed down by weakness on Wall Street and in Asia overnight as investors reassess the August rally which added 6.5 percent to the index.
Banks took the most points off the index led by falls in Lloyds Banking Group and Royal Bank of Scotland after uncertainty over financial companies' health battered U.S. peers overnight.
The Guardian reported that Lloyds has won backing from its investors to raise 10 billion pounds to reduce its dependence on the taxpayer.
Barclays, Standard Chartered and Royal Bank of Scotland fell 0.4 to 4.2 percent, while HSBC climbed 0.3 percent.
"The whole rally was effectively a banking recovery and as soon as you start to see the banks wobbling it is very, very hard for the market to actually remain well supported," said Geoff Wilkinson, Head of Investment Research at Mint.
"(On the FTSE) 4,750 is the next support level we are seeing. That's where we stalled in mid-May and we took a long time to get through that. It's a good short term support level. If we get below that we may get a proper sell off," Wilkinson added.
Mining also fell back as metal prices retreated on demand concerns. Rio Tinto, Xstrata, Lonmin, Anglo American, Kazakhmys and Xstrata were down 0.6 to 2.3 percent.
Energy stocks were in negative territory as crude prices stayed below $70 a barrel after sharp falls in the previous session. Royal Dutch Shell, Tullow Oil and Cairn Energy lost between 0.2 and 2.0 percent
Life insurers were lower, with Legal & General, Aviva, Old Mutual and Prudential down between 1.3 and 4.7 percent.
Ex-dividend factors knocked 2.79 points off the FTSE 100 index, with BHP Billiton, Capita, Friends Provident, Serco, L&G and TUI Travel all losing their payout attractions.
RISK AVERSION UP
Defensive drugmakers, viewed as safe-bet stocks, gained as risk aversion took hold. AstraZeneca, GlaxoSmithKline and Shire were up 0.1 to 0.7 percent.
Mobile telecommunication firm Vodafone Group, another defensive stock, rose 0.4 percent while tobacco firms Imperial Tobacco and British American Tobacco were up 0.2 to 0.6 percent.
Retailers saw good demand as Banc of America-Merrill Lynch reinstated coverage on 10 general retail stocks as it launched combined coverage of the food and general retail sector.
The broker said its top UK sector picks were Marks & Spencer , Kingfisher and Wm. Morrison. Shares in the trio gained 0.4 to 2.1 percent.
The blue chip index has rebounded 38 percent since the trough in March, and is up 13 percent so far this quarter, but analysts warn that September could see a period of consolidation on the index after low trading volumes during the summer holidays.
No important UK economic data is due for release on Wednesday, so investors will be looking across the Atlantic for macro direction, notably from publication of minutes from the last Federal Reserve's policy meeting of August 11-12 due at 1800 GMT.
Among a swathe of other U.S. data are July factory orders, revised July durable goods orders and the August ADP National Employment survey, which should demand that most attention ahead of Friday's August U.S. jobs report. (Reporting by Harpreet Bhal; Editing by Jon Loades-Carter)