Sun, Dec 18, 2011 - Page 10 News List

European stocks slide on debt crisis, Fed


European stocks fell for a second week as concern lingered that the region’s debt crisis is deepening and the US Federal Reserve refrained from taking new action to bolster the world’s largest economy.

BNP Paribas SA and Bayerische Motoren Werke AG led banks and carmakers lower, falling more than 7 percent as investors shunned companies with profits most tied to economic growth. Logica PLC plunged 23 percent after the Anglo-Dutch computer-services provider reduced its sales-growth forecast.

The STOXX Europe 600 Index slid 2.8 percent to 233.71 this past week. The benchmark gauge has slumped 15 percent this year as the eurozone’s sovereign-debt crisis spread to Italy and Spain and economic growth in the US slowed.

“There is a risk that we will get a pretty serious recession in Europe,” Edinburgh-based Kames Capital PLC strategy chief Bill Dinning said. Kames Capital manages £47 billion (US$73 billion).

Moody’s Investors Service said it will review the ratings of all EU countries in the first quarter because an EU summit on Dec. 8 and Dec. 9 failed to deliver “decisive policy measures” to end the debt crisis.

Investors cut holdings in European stocks, with 35 percent saying they were “underweight” in the region this month, compared with 30 percent last month.

National benchmark indexes fell in all of the 18 western European markets.

France’s CAC 40 lost 6.3 percent, Germany’s DAX slid 4.8 percent and the UK’s FTSE 100 sank 2.6 percent.

BNP Paribas, France’s biggest bank, retreated 15 percent. Societe Generale SA also declined 15 percent and HSBC Holdings PLC, the region’s largest lender, dropped 4.8 percent.

A gauge of banks in the STOXX 600 fell 6.1 percent, extending its slump for the year to 35 percent.

This story has been viewed 3377 times.

Comments will be moderated. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned.

TOP top