By Carla Mozee, MarketWatch OECD foresees slowing growth in
Europe
LONDON (MarketWatch) -- European stocks dropped Wednesday, with
bank issues lower after some heavyweight financial services agreed
to pay a multi-billion dollar fine to settle allegations that
traders at the firms helped rig currency markets.
Losses overall accelerated after data underscored weakness in
regional economic activity.
Big banking settlement:Five banks have agreed to pay a total of
$3.3 billion to U.S., British and Swiss regulators to resolve a
long-running investigations into whether the banks engaged in
activities within their foreign-exchange units that helped rig spot
market prices.
HSBC Holdings PLC, Royal Bank of Scotland Group PLC, UBS AG,
Citigroup Inc. and J.P. Morgan Chase & Co. made settlements
with British and U.S. authorities. UBS was separately ordered by
Switzerland's Finma to pay 134 million Swiss francs ($139
million).
Investors later in the session learned from the European Union's
statistics agency that industrial output in the eurozone rose 0.6%
in September from August. That figures was just below a rise of
0.7% expected by economists polled by The Wall Street Journal. But
the advance didn't reverse the 1.4% drop in August, indicating that
third-quarter output will be lower than in the second quarter.
Separately, the Organization for Economic Cooperation and
Development said economic growth is set to slow in the eurozone and
in the U.K. over the coming months.
Markets: The Stoxx Europe 600 index fell 1.1% to close at
335.09, falling from a five-week closing high reached on
Tuesday.
In the banking group, shares of HSBC Holdings PLC (HSBC) dropped
0.3%, RBS (RBS) fell 1%, and UBS AG (UBS) lost 0.1%. Shares of
Barclays PLC (BCS) dropped 2.2% as the bank pulled out of
late-stage settlement talks with regulators, saying it decided to
seek a "more general coordinated settlement."
The pullback in bank shares weighed on the U.K.'s FTSE 100 ,
which fell 0.3% to 6,611.04. Meanwhile, the British pound fell
after the Bank of England cut its forecasts for growth and
inflation and signaled it is unlikely to raise interest rates until
the second half of next year. The pound (GBPUSD) fell to $1.5817,
from $1.5918 late on Tuesday. Read: Pound creeps toward one-year
low after action-packed day
France's CAC 40 index gave up 1.5% to 4,179.88 and Germany's DAX
30 index fell 1.7% to 9,210.96.
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