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European stocks lower on poor bank earnings

European stocks lower on poor bank earnings

European stock markets were mostly lower on Thursday on downbeat earnings from major banks while the euro rose against the dollar after the US Federal Reserve’s latest economic outlook, traders said.

In midday deals, Frankfurt’s DAX 30 index shed 0.57 percent to 6,666.63 points and the Paris CAC 40 fell 0.75 percent to 3,209.96 points but in London the FTSE 100 edged up 0.07 percent to 5,722.88 points.

Milan slid 1.0 percent to 14,461.23 points after an Italian debt auction that raised 8.5 billion euros ($11.3 billion) in six-month bonds at higher rates than a similar sale last month.

In foreign exchange deals, the euro advanced to $1.3239 from $1.3215 in New York late Wednesday.

The banking sector took a hit following weak earnings from Britain’s Barclays, Spain’s Santander and Germany’s Deutsche Bank.

Barclays shares lost 1.23 percent to 213.6 pence after it suffered a net loss of £337 million ($546 million, 412 million euros) in the first quarter due to a huge accounting charge and compensation claims.

Santander tumbled 4.21 percent to 4.709 euros after the Spanish bank’s first-quarter net profit slumped 23.9 percent to 1.6 billion euros.

Deutsche Bank meanwhile dived 5.27 percent to 32.335 euros after Germany’s biggest lender said its net profit plunged by a third in the first three months as a result of weaker market conditions and exceptional charges.

In London, pharmaceuticals giant AstraZeneca topped the fallers board, shedding 5.83 percent to 2,675.3 pence.

The Anglo-Dutch drugs said net profits dived 44 percent in the first quarter and announced the exit of chief executive David Brennan.

On the upside, energy giant Royal Dutch Shell was boosted after posting a 16-percent jump in adjusted first-quarter net profits on the back of higher oil prices, with its shares up 3.2 percent to 2,259 pence.

Asian markets edged up on Thursday after a cautiously upbeat assessment of the US economy by the Federal Reserve and comments from its chairman that he would provide more support if necessary.

Earlier gains were pared as dealers await a Bank of Japan policy meeting on Friday, while ongoing concerns about Europe proved to be a weight on sentiment.

Tokyo was closed flat, Hong Kong added 0.79 percent, Seoul gained 0.10 percent and Sydney rose 0.34 percent.

On Wednesday the Fed said it would keep interest rates at super-low levels until at least 2014 and forecast the world’s biggest economy would grow more than first stated this year while unemployment would continue to fall.

However, it held off on any more stimulus measures for now, instead sticking to its current loose policy despite recent data showing the big pick-up in job creation had slowed.

After the two-day meeting chairman Ben Bernanke said further stimulus would be “reckless” but added that he was ready to use whatever tools he had at his disposal at any moment.

The Fed news boosted Wall Street’s main indexes on Wednesday. The Dow climbed 0.69 percent, the Nasdaq jumped 2.30 percent and the S&P 500 rose 1.36 percent.

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