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Europe: Bank shares lead European stock drop as Greece falls for 2nd day
[FRANKFURT] European stocks snapped a five-day winning streak as declines in banks outweighed a surge in miners. Greek shares slid for a second day.
Credit Agricole SA dragged lenders to the worst performance on the Stoxx Europe 600 Index, tumbling 10 per cent after signaling it failed to win backing from regulators for a reorganization that may free up capital to repay investors. Total SA and Eni SpA pulled oil-and-gas companies down, as crude traded in a bear market. BHP Billiton Ltd and Rio Tinto Group rose at least 1.6 per cent, pushing commodity producers to the biggest gain on the equity gauge as some metal prices rebounded.
The Stoxx 600 retreated 0.2 per cent to 398.75 at the close of trading, after earlier losing as much as 0.6 per cent. Italy's FTSE MIB Index and Spain's IBEX 35 Index dropped 1 per cent.
"The banking sector today is burdened mainly by Credit Agricole," said Christian Stocker, a strategist at UniCredit Bank AG in Munich. "There were hopes that some capital could be repaid to investors. Mining stocks were extremely weak the last few weeks and the reaction today is nothing but a small relief."
Greece's ASE Index, which plummeted 16 per cent on reopening Monday after a five-week suspension, lost 1.2 per cent, for the biggest drop among western-European markets. The emergency curbs placed on trading before the resumption of activity are making routine tasks like buying and selling often impossible, according to local brokers.
Piraeus Bank SA tumbled the maximum 30 per cent for a second day, to record low. National Bank of Greece SA slid 29 per cent, also to a new low.
BMW AG dropped 1.3 per cent after saying that slowing sales in China may force it to revise this year's profitability goals.
Shire Plc slipped 5.9 per cent after making an unsolicited offer to buy Baxalta Inc, a business spun off by Baxter International Inc last month, for about US$30 billion in stock.
Continental AG advanced 5.7 per cent as Europe's second biggest maker of car parts raised its 2015 profitability goal. Smiths Group Plc climbed 4.4 per cent after people familiar with the matter said ValueAct Capital Management has bought a stake in the British engineering company.