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European stocks decline as Spain concerns resurface; Dax down 0.33%

Published 10/26/2012, 03:38 AM
Updated 10/26/2012, 03:39 AM
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Investing.com - European stocks declined on Friday, as disappointing earnings reported weighed on market sentiment, while uncertainty over a potential bailout for Spain persisted.

During European morning trade, the EURO STOXX 50 dropped 0.56%, France’s CAC 40 declined 0.51%, while Germany’s DAX 30 fell 0.33%.

Sentiment briefly strengthened on Thursday, after the release of positive U.S. economic data.

But investors remained cautious clouded amid ongoing uncertainty over when Spain will request a bailout and trigger the European Central Bank's bond-buying programme.

Financial stocks were broadly lower, as shares in French lenders BNP Paribas and Societe Generale tumbled 3.15% and 2.81%, while Germany's Deutsche Bank and Commerzbank retreated 0.72% and 0.20% respectively.

Peripheral lenders added to losses, as Italian banks Unicredit and Intesa Sanpaolo dropped 0.97% and 0.55%, while Spain's BBVA and Banco Santander slumped 1.94% and 1.48%.

Meanwhile, Ericsson plumged 4.46% after the world’s largest maker of mobile-phone networks reported third-quarter gross margin, or the percentage of sales remaining after production costs, that slid to 30.4% from 35%, missing the average estimate of 32.2%.

Also on the downside, Publicis, the third-largest advertising company, plummeted 2.78% after reporting third-quarter revenue that missed analysts’ estimates. The company cited a “sudden downturn” in European economies for a slowdown in ad spending.

In London, commodity-heavy FTSE 100 slid 0.54%, weighed by heavy losses in mining stocks.

Mining giants Rio Tinto and BHP Billiton plunged 2.10% and 1.68% respectively, while copper producers Xstrata and Kazakhmys declined 0.74% and 3.12%.

Elsewhere, U.K. lenders tracked their European counterparts lower, as shares in HSBC Holdings dropped 0.68% and Barclays tumbled 1.38%, while the Royal Bank of Scotland and Lloyds Banking plummeted 1.42% and 1.84% respectively.

In the U.S., equity markets pointed to a lower open. The Dow Jones Industrial Average futures pointed to a 0.73% drop, S&P 500 futures signaled a 0.66% decline, while the Nasdaq 100 futures indicated a 0.55% slump.

Later in the day, the U.S. was to release preliminary data on third quarter gross domestice product. In addition, the University of Michigan was to release revised data on consumer sentiment.


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