ROME: European stocks on Thursday finished lower as Deutsche Bank AG and Barclays PLC came under scrutiny in the wake of lackluster financial updates.
The Stoxx Europe 600 SXXP, -0.03% ended down less than 1 point at 375.70, but had been off by as much as 0.6% intraday. Gains for technology, consumer-related and telecom shares nearly offset losses for financial, utility and commodity stocks.
Near the bottom of the pan-European index was Deutsche Bank AG DBK, -7.72% DB, -7.98% Shares sank 6.9%, with their worst performance in two months spurred after the banking heavyweight scrapped its dividend payout for this year and next, as well as outlining plans to cut 35,000 jobs under a major overhaul. The German bank posted a €6 billion ($6.6 billion) net loss for the third quarter, in line with a recent warning.
“There’s a big retrenchment going on under new co-chief executive John Cryan, which is necessary to upheave the culture and turn the bank around, but doing so inevitably loses investors looking for profit growth in the near-term,” said Jasper Lawler, market analyst at CMC Markets, in a note.
Deutsche Bank shares weighed on Germany’s DAX 30 DAX, -0.29% which closed down 0.3% at 10,800.84. Meanwhile, France’s CAC 40 PX1, -0.10% declined 0.1% to 4,855.82.
In London, the FTSE 100 UKX, -0.65% fell 0.7% to 6,395.80, hurt in part by losses in shares of Barclays PLC and Royal Dutch Shell PLC.
Friday will mark the last trading day in October, and the Stoxx 600 is on course to finish the month with a rise of 8%. That would be the index’s best monthly gain since July 2009.
Barclays BARC, -6.28% BCS, -7.01% shares suffered their worst day since June 2014, FactSet data showed, falling 6.3% after the bank posted a weaker-than-expected third-quarter profit, and said new U.K. and U.S. regulatory requirements would drag on returns and add to costs over the next three years.
Shell RDSB, -1.46% RDS.B, -1.27% shares fell 1.5% after the oil major swung to a third-quarter loss after taking charges of $7.9 billion on abandoned projects, amid a 16-month slump in oil prices.
Euro: The euro EURUSD, +0.0000% meanwhile, won back some of the value it lost late Wednesday. U.S. government data released Thursday showed third-quarter gross domestic product in the world’s largest economy slowed to an annual growth rate of 1.5%. The euro was buying $1.0960. Late Wednesday, it fetched $1.0905.
The greenback late Wednesday had hit its highest level against the euro in nearly three months after the U.S. Federal Reserve said it would focus on its “next meeting” in mid-December on whether to raise interest rates.
