UKX FTSE 100 Index

By Carla Mozee and Barbara Kollmeyer, MarketWatch

Reports of hedge funds yanking billions of dollars from the big German lender

European stock markets fell Friday, as shares of Deutsche Bank AG plunged on concerns about the lender's financial health, triggering losses across the financial sector.

The Stoxx Europe 600 index slid 1% to 339.33, but was off session lows. Still, the pan-European benchmark is looking at losses for the week, the month and quarter. The index on Thursday (http://www.marketwatch.com/story/european-stocks-jump-as-opec-surprises-with-plan-to-cut-oil-output-2016-09-29) finished a choppy session barely higher, closing up less than 0.1% at 342.72.

Shares of Deutsche Bank (DBK.XE) (DBK.XE) (DBK.XE) were off 4.5%, after losing more than 7% early in the session. The stock traded briefly under 10 euros, its lowest level on record, as the market got its first chance to react to reports that some of Deutsche Bank's biggest clients have been pulling out funds (http://www.marketwatch.com/story/fearful-clients-pull-billions-of-dollars-out-of-deutsche-bank-2016-09-30).

That news weighed heavily on U.S. stocks Thursday (http://www.marketwatch.com/story/wall-street-stocks-could-struggle-as-euphoria-over-opec-deal-fades-2016-09-29), with the Dow industrials closing down nearly 200 points. Asian stocks (http://www.marketwatch.com/story/asian-shares-rattled-by-concerns-over-oil-deutsche-bank-2016-09-30) also had a mostly losing session, as financia stockls fell across Japan and elsewhere.

(http://www.marketwatch.com/story/fearful-clients-pull-billions-of-dollars-out-of-deutsche-bank-2016-09-30)"What must be understood here is that Deutsche Bank is the main clearing house for trades in Europe," David Buik, market commentator at Panmure Gordon & Co., said in a note to clients Friday. "With over $60 trillion derivative book at the Deutsche Bank, the government is totally incapable of even understanding how to deal with this crisis."

Read:Deutsche Bank crisis threatens to roil global markets (http://www.marketwatch.com/story/a-crisis-in-european-banks-threatens-to-roil-global-markets-2016-09-28)

Panic spreads: Deutsche Bank's woes infected the rest of the European banking sector, which tumbled as concerns about the German bank intensified. Commerzbank AG (CBK.XE) fell 5.5%, France's Credit Agricole SA (ACA.FR) dropped 3.2%, and Barclays PLC (BCS) (BCS) shed 2.4%.

The Stoxx Europe 600 Bank Index was pushed 2.2% lower Friday, and was on track for a monthly loss of 5.5%.

Pressure on banks hurt national indexes. France's CAC 40 index was down 1.4%, Italy's FTSE MIB gave up 1.2%, and the FTSE 100 index was 1% lower.

The biggest losses on indexes were seen in Spain, where the IBEX 35 dropped 2% as heavyweights Banco Santander ES (SAN) (SAN) and BBVA SA (BBVA) (BBVA) fell 4% each.

Other movers: Telefónica SA (TEF) shed 4.4% after the Spanish telecommunications company on Thursday canceled a planned initial public offering of its Telxius infrastructure business because of tepid investor demand.

Airbus Group SE (AIR.FR) declined 1.2%, with the aerospace heavyweight set to cut (http://www.marketwatch.com/story/airbus-to-cut-management-jobs-in-internal-merger-2016-09-30) an unspecified number of management jobs as part of a restructuring plan.

(END) Dow Jones Newswires

September 30, 2016 05:30 ET (09:30 GMT)

FTSE 100
Index Chart
From Mar 2024 to Apr 2024

FTSE 100
Index Chart
From Apr 2023 to Apr 2024