• September 28, 2016
    Last updated 5 minutes ago


Deutsche Bank slump drags down lenders as Europe stocks decline

Europe’s lenders are down 23% this year for the biggest losers among industry groups

14:11 September 16, 2016

ZURICH: A lenders’ sell-off led by Deutsche Bank AG sent European equities toward a one-month low.

The German lender sank 6.6 per cent, heading for its biggest slump since the aftermath of the British secession vote, after rebuffing the $14 billion that the US Justice Department is seeking to settle a probe into the firm’s sale of residential mortgage-backed securities. Royal Bank of Scotland Group Plc and Credit Suisse Group AG also fell more than 3.9 per cent. A gauge tracking the region’s lenders was set for its lowest level since the end of August.

The Stoxx Europe 600 Index lost 0.3 per cent at 9.12am in London, dropping for a sixth time in seven days. Concerns about lenders and worries that the region’s central bank may balk at adding stimulus are sending the Stoxx 600 down for a second week for the first back-to-back declines since June. The region’s lenders are down 23 per cent this year for the biggest losers among industry groups.

European Central Bank President Mario Draghi downplayed the need for more aid last week, even as a Citigroup Inc. index tracking economic data for the euro area showed they’re missing forecasts by the most since April. At the same time, speculation for the path of Federal Reserve rate policy has weighed on the market as volatility and trading volume returned in the past week. On Friday, the number of Stoxx 600 shares changing hands was almost 40 per cent greater than the 30-day average.

Among other shares moving on corporate news, Fiat Chrysler Automobiles NV fell 1.8 per cent after saying it’s recalling about 1.4 million cars and trucks in the US British private-equity firm SVG Capital Plc gained 4.1 per cent after saying an unsolicited bid by HarbourVest Partners LLC undervalues the firm and that is has other offers.