Investing.com - European stocks declined on Tuesday, amid uncertainty over whether Spain will ask for help from the European Central Bank's new bond-purchasing program and ahead of a highly-anticipated Spanish government bond auction.
During European morning trade, the EURO STOXX 50 tumbled 1.14%, France’s CAC 40 slumped 1.02%, while Germany’s DAX 30 dropped 0.89%.
Reuters reported earlier that Spanish Prime Minister Mariano Rajoy remains uncertain about tapping the ECB’s bond-buying program, which would mean signing up to a permanent bailout fund.
Spain's government faced protests over the weekend against public spending cuts, even as Madrid told its European partners that its next steps to overhaul the economy would avoid further cuts in public spending.
Madrid was preparing to sell up to EUR4.5 billion of 12 and 18-month treasury bills later in the day, which will be seen as a test of investor confidence as the yield on Spanish 10-year government bonds rose to 5.96% earlier Tuesday, hovering close to the 6% threshold, widely seen as unsustainable in the long term.
Financial stocks were broadly lower, led by Italian lenders Intesa Sanpaolo and Unicredit, down 3.57% and 2.53%, while Spain's BBVA and Banco Santander tumbled 2.73% and 1.76% respectively.
Germany's Deutsche Bank and Commerzbank also added to losses, with shares declining 2.55% and 2.85%, while French banks Societe Generale and BNP Paribas dropped 2.76% and 1.79%.
Auto stocks were also on the downside after Moody's Investors Service said on Monday that sluggish demand in Europe and weakening sales in China will hurt the growth prospects for the global auto industry. German groups Volkswagen and BMW plunged 2.64% and 2.14%, while French manufacturers Renault and Peugeot plummeted 2.95% and 2.54%.
In London, FTSE 100 declined 0.69%, as U.K. lenders tracked their European counterparts sharply lower.
Shares in the Royal Bank of Scotland plunged 3.48% and Barclays dropped 3.57%, while Lloyds Banking and HSBC Holdings retreated 1.91% and 0.57% respectively.
Mining giants Rio Tinto and BHP Billiton also posted sharp losses, with shares plummeting 2.85% and 2.15% respectively, while copper producers Xstrata and Kazakhmys retreated 1.50% and 3.81%.
Elsewhere, shares in Aviva plummeted 4.40%, despite reports the insurance group's wrap platform has grown 53% in assets ince the beginning of 2012, breaching the GBP1 billion barrier for the first time.
In the U.S., equity markets pointed to a lower open. The Dow Jones Industrial Average futures pointed to a 0.24% fall, S&P 500 futures signaled a 0.21% decline, while the Nasdaq 100 futures indicated a 0.31% loss.
Later in the day, the ZEW Centre for Economic Research was to release a report on German economic sentiment, as well as a separate report on sentiment throughout the entire bloc.
The U.S. was to release official data on the current account, as well as a report on the balance of domestic and foreign investment in long-term securities.
During European morning trade, the EURO STOXX 50 tumbled 1.14%, France’s CAC 40 slumped 1.02%, while Germany’s DAX 30 dropped 0.89%.
Reuters reported earlier that Spanish Prime Minister Mariano Rajoy remains uncertain about tapping the ECB’s bond-buying program, which would mean signing up to a permanent bailout fund.
Spain's government faced protests over the weekend against public spending cuts, even as Madrid told its European partners that its next steps to overhaul the economy would avoid further cuts in public spending.
Madrid was preparing to sell up to EUR4.5 billion of 12 and 18-month treasury bills later in the day, which will be seen as a test of investor confidence as the yield on Spanish 10-year government bonds rose to 5.96% earlier Tuesday, hovering close to the 6% threshold, widely seen as unsustainable in the long term.
Financial stocks were broadly lower, led by Italian lenders Intesa Sanpaolo and Unicredit, down 3.57% and 2.53%, while Spain's BBVA and Banco Santander tumbled 2.73% and 1.76% respectively.
Germany's Deutsche Bank and Commerzbank also added to losses, with shares declining 2.55% and 2.85%, while French banks Societe Generale and BNP Paribas dropped 2.76% and 1.79%.
Auto stocks were also on the downside after Moody's Investors Service said on Monday that sluggish demand in Europe and weakening sales in China will hurt the growth prospects for the global auto industry. German groups Volkswagen and BMW plunged 2.64% and 2.14%, while French manufacturers Renault and Peugeot plummeted 2.95% and 2.54%.
In London, FTSE 100 declined 0.69%, as U.K. lenders tracked their European counterparts sharply lower.
Shares in the Royal Bank of Scotland plunged 3.48% and Barclays dropped 3.57%, while Lloyds Banking and HSBC Holdings retreated 1.91% and 0.57% respectively.
Mining giants Rio Tinto and BHP Billiton also posted sharp losses, with shares plummeting 2.85% and 2.15% respectively, while copper producers Xstrata and Kazakhmys retreated 1.50% and 3.81%.
Elsewhere, shares in Aviva plummeted 4.40%, despite reports the insurance group's wrap platform has grown 53% in assets ince the beginning of 2012, breaching the GBP1 billion barrier for the first time.
In the U.S., equity markets pointed to a lower open. The Dow Jones Industrial Average futures pointed to a 0.24% fall, S&P 500 futures signaled a 0.21% decline, while the Nasdaq 100 futures indicated a 0.31% loss.
Later in the day, the ZEW Centre for Economic Research was to release a report on German economic sentiment, as well as a separate report on sentiment throughout the entire bloc.
The U.S. was to release official data on the current account, as well as a report on the balance of domestic and foreign investment in long-term securities.