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Sun, Feb 28, 2010 - Page 10 News List

European stocks drop as Raiffeisen and carmakers fall

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European stocks declined for the first week in three as concern about Greece’s budget deficit offset better-than-expected results from companies including Safran SA and Royal Bank of Scotland Group PLC.

Raiffeisen International Bank Holding AG plunged 17 percent on doubts about the impact of a possible merger with its majority shareholder. Renewable Energy Corp ASA fell 15 percent on concern about a potential share sale. Safran increased 15 percent. Royal Bank of Scotland rose 9.1 percent. Carlsberg A/S climbed 8.7 percent after forecasting increased profitability.

The Dow Jones STOXX 600 Index dropped 1.8 percent to 245.80 this week, snapping two weeks of gains. The benchmark gauge has retreated 5.6 percent from this year’s high on Jan. 19 as concern mounted over budget deficits in Greece, Spain and Portugal, and as China moved to restrict lending and stop its economy from overheating. The measure has still rallied 56 percent since March last year.

National benchmark indexes fell in all 18 western European markets except Iceland, Finland and Switzerland. Germany’s DAX fell 2.2 percent and France’s CAC 40 slid 1.6 percent, while the UK’s FTSE 100 retreated 0.1 percent.

Automobile stocks fell the most among the industry groups in the STOXX 600, losing 4.1 percent. The European auto industry “cannot count on a quick recovery” in demand, even as it reaches a “turning point” this year, Dieter Zetsche, chief executive officer of Daimler AG and president of the ACEA European auto manufacturers’ association, said on Tuesday.

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