News Column

European Stocks Extend Slide On Portugal Fears

July 10, 2014

BRUSSELS (Alliance News) - The threat of a banking crisis in Portugal spooked the financial sector on Thursday, driving European stocks sharply lower for a third day in four.

France and Italy reported a notable drop in industrial output in May, further souring the mood in markets around Europe.

EspÍrito Santo Financial Group SA, the controlling shareholder of Portuguese lender Banco EspÍrito Santo SA, suspended trading in its own shares and bonds.

Shares of Banco EspÍrito Santo, which haven't been suspended, plummeted 17%.

The major averages around Europe reflected worries that Portugal's woes will spread. The Euro Stoxx 50 index of eurozone bluechip stocks plunged 1.57%, and is down 4.2% from a week ago.

Germany's DAX slipped 1.5%, France CAC 40 dropped 1.34% and the UK'sFTSE slipped 0.68%.

In Frankfurt, Commerzbank fell 2% and Deutsche Bank lost 2.4%.

Lufthansa lost 4.5% after Turkish Airlines dismissed media reports that it was in advanced discussions with the German carrier on a venture for long-haul projects.

Miners traded mostly lower, with BHP Billiton and Rio Tinto in the red after Chinese exports figures came in below estimates.

Burberry Group added 3% after the luxury goods retailer reported growth in retail revenue for the first quarter, exceeding estimates.

Shares of Fugro NV were down 20% in Amsterdam after the Dutch marine services company issued a profit warning, citing slowing growth in capital spending in the oil and gas market.

In economic news from Europe, France and Italy reported a notable drop in industrial output in May. Dutch industrial production grew at a slower rate in May.

Meanwhile, the Bank of England has kept its interest rate at a historic low the size of quantitative easing at GBP 375 billion as expected by economists.

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Source: Alliance News

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