EUROPE MARKETS: Bank Selloff Leads European Stocks To One-week Low On 'Trump Trade' Worries
March 22 2017 - 1:35PM
Dow Jones News
By Carla Mozee and Sara Sjolin, MarketWatch
ING under Dutch criminal investigation
European stocks fell to a one-week low Wednesday, with bank
shares among the worst performing, as investors questioned whether
the new U.S. administration can soon deliver the fiscal and
regulatory changes needed to support the "Trump trade."
The Stoxx Europe 600 dropped 0.4% to end at 374.03, marking its
lowest closing level since March 14.
Wednesday's loss built on a 0.5% drop on Tuesday, when a sharp
selloff in the U.S. dampened the investment mood globally.
"Since Donald Trump's election, markets in the U.S. have been
marching higher, driven by nothing more than rampant speculation
that this would be a hugely pro-business administration, but with
promises failing to be delivered and a central bank that is taking
an ever more hawkish view over monetary policy, it does seem as if
the punch bowl is on the cusp of being withdrawn," said Tony Cross,
market analyst at TopTradr, in a note.
Analysts said the trigger for the selloff was the perception
that President Donald Trump will struggle to push through his
decided changes to health care. Thursday's vote in the U.S. House
of Representatives on the Republican Party's health-care plan may
be a litmus test for investors on whether the push for reforms in
the U.S. will be successful.
Read:U.S. president goes to bat for 'Trumpcare' ahead of vote
(http://www.marketwatch.com/story/trump-today-president-goes-to-bat-for-trumpcare-ahead-of-vote-2017-03-21)
Shares of European banks -- many of which have U.S. operations
-- have been beneficiaries of expectations that regulatory
restrictions will be loosened and that the Fed will continue to
raise interest rates, as higher rates help bank margins. The Stoxx
Europe 600 Bank Index was shaken down 0.9% on Wednesday.
Among decliners, Deutsche Bank AG (DBK.XE) (DBK.XE) fell 1.7%,
Credit Agricole SA (ACA.FR) lost 0.7% and Barclays PLC (BCS) (BCS)
dropped 2.4%.
Movers: Also weighing on the bank sector was ING Groep NV's
(ING) (ING) disclosure that it is under a criminal investigation by
Dutch officials could lead to significant penalties. Reports
Wednesday said the investigation was tied to an alleged bribery
case in Uzbekistan. ING shares closed 4% lower.
Fiat Chrysler Automobiles (FCA.MI) fell 0.6% following reports
that a formal investigation into whether the company cheated in
tests for diesel emissions was opened by French prosecutors.
Gemalto NV shares (GTO.AE) plunged 17% after the digital
security firm cut its financial guidance.
Akzo Nobel NV (AKZOY) (AKZOY) fell 1.1% after the Dutch paint
and chemicals maker rejected a second takeover offer from PPG
Industries Inc
(http://www.marketwatch.com/story/akzo-nobel-rebuffs-ppgs-sweetened-24-bln-bid-2017-03-22).
(PPG) .
London attack: At least one person was reported dead
(http://www.marketwatch.com/story/shots-fired-near-uk-parliament-police-treating-it-as-terrorist-incident-2017-03-22)
and dozens injured in the U.K. capital after a car early afternoon
car drove directly toward pedestrians on Westminster Bridge, near
the Houses of Parliament. Gun shots were following fired near the
parliament and a police officer was stabbed.
"We are treating the attacks as a terrorist incident until we
know otherwise," London's Metropolitan Police said on a post to
Twitter
(https://twitter.com/metpoliceuk/status/844572599342518273).
Indexes: The U.K.'s FTSE 100 gave up 0.7% to close at 7,324.72,
having trade lower all through the session.
Germany's DAX 30 index dropped 0.5% to 11,904.12 and France's
CAC 40 fell 0.2% to 4,994.70.
The euro was buying $1.0805, compared with $1.0812 late Tuesday
in New York.
(END) Dow Jones Newswires
March 22, 2017 13:20 ET (17:20 GMT)
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