(Adds CEO comments, share price, analysts)

July 20 (Reuters) - Home appliance maker Electrolux reported second-quarter operating earnings above forecast and raised its outlook for the European market this year, but shares fell as slower than expected sales in North America weighed.

 Shares in Electrolux, a rival of U.S. Whirlpool Corp , drop 4.5 pct vs a 0.9 pct rise in the Stockholm blue-chip OMXS30 index.

 Analysts cite weak sales in North America, worries over raw material price effects in 2017 and investor repositioning due to higher unofficial earnings expectations as possible reasons for share drop.

 Sales in North American business unexpectedly dropped, with Q2 organic growth down 1.5 pct. Co cites decline in private label sales, while sales under its own brands rose

 Says expects private label sales to continue to be a drag throughout the year.

 Says now expects European market demand to grow by 2-4 pct in 2016

 Co's April outlook was for Western European market to grow by 2-3 pct in 2016 and the market in Eastern Europe by approximately 2 pct

 Says following Brexit referendum, outlook for UK demand and British pound is uncertain

 Electrolux CEO says: "we have seen mainly the UK construction industry signalling they will be more cautious going forward"

 Electrolux CEO on Brexit: "Says in terms of regular retail demand, we are not seeing as much of an impact at this stage"

 Q2 operating profit increased to 1.56 bln SEK ($181 million) vs 921 mln SEK in year-ago quarter while sales dropped to 30.0 bln SEK (31.4)

 Reuters poll: Electrolux Q2 net sales were seen at 30.6 bln SEK, operating profit at 1.52 bln

 Says four of six business areas achieved an operating margin above its long-term group financial target of 6 pct

 Q2 op margin at 5.2 pct vs mean forecast 5.0 pct. Operating margin in North America at 6.5 pct vs forecast 5.8 pct, main reason for group profit beat

 Says we expect market demand for appliances in North America to grow by 4-5 pct in 2016 (unchanged from April outlook)

 Says we expect Latin American market to remain weak also in second half of 2016

Source text for Eikon: Further company coverage: ($1 = 8.6113 Swedish crowns) (Reporting by Johannes Hellstrom; editing by Niklas Pollard)