Forexpros – European stocks fell on Wednesday, weighed by a string of disappointing earnings reports, while investors eyed the European Central Bank for signs of further action to counter the effects of the euro zone’s debt crisis.
During European morning trade, the EURO STOXX 50 fell 0.13%, France’s CAC 40 edged down 0.16%, while Germany’s DAX 30 declined 0.17%.
Markets eyed the ECB amid expectations the bank will soon take steps to help lower Spanish and Italian borrowing costs, after bank head Mario Draghi indicated last week that the ECB may restart its bond buying program.
The ECB said action would be conditional on euro zone governments experiencing difficulty on bond markets activating the bloc’s bailout funds to purchase government bonds and accepting strict conditions and supervision.
Meanwhile, ratings agency Standard & Poor’s revised Greece’s credit rating outlook from stable to negative on Tuesday, saying that a worsening economy raises the likelihood the troubled nation will need more support from European Union lenders.
Dutch lender ING Group was among the session’s top losers, with shares dropping 0.75%, after reporting second-quarter net income of EUR1.17 billion, missing analyst estimates of EUR1.26 billion.
Other financial stocks were broadly lower, as shares in France’s BNP Paribas tumbled 1.25%, while German lenders Deutsche Bank and Commerzbank declined 1.60% and 0.63% respectively.
Elsewhere, Swisscom retreated 1.57% after the phone company said second-quarter net income declined to CHF468 million from CHF485 million a year earlier.
In addition, Morgan Stanley downgraded the shares to underweight from equal weight.
In London, FTSE 100 declined 0.26%, as investors eyed comments by Bank of England Governor Mervyn King, as well as the bank’s inflation report.
Standard Chartered jumped 5.64% after plunging on Tuesday, as the bank might be asked to pay as much as USD700 million to resolve money laundering allegations filed by New York’s banking superintendent.
The U.K. lender is accused of scheming with the Iranian government to launder billions of dollars to potentially support terrorist activities.
Meanwhile, other financial stocks were mixed. Shares in the Royal Bank of Scotland climbed 0.53% and Lloyds Banking fell 0.25%, while HSBC Holdings and Barclays declined 0.46% and 1% respectively.
Mining giants Rio Tinto and BHP Billiton were also mixed, with shares surging 1.37% and dropping 0.38% respectively, while copper producers Xstrata and Kazakhmys declined 0.40% and 0.60%.
In the U.S., equity markets pointed to a lower open. The Dow Jones Industrial Average futures pointed to a 0.18% fall, S&P 500 futures signaled a 0.22% decline, while the Nasdaq 100 futures indicated a 0.01% loss.
Later in the day, Germany was to release official data on industrial production, after data on Tuesday showed that German factory orders tumbled 1.7% in June, almost twice as much as expectations for a 1.0% decline.
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