The European markets are trading lower on Friday, after Germany's business confidence deteriorated more than expected in June. The Asian markets fell on growth fears, following weak data from the U.S. overnight.
Moody's Investors Service downgraded the credit ratings of 15 major banks, including Barclays, Credit Suisse, Deutsche Bank, UBS and HSBC. However, the action did not impact investor confidence much.
The Euro Stoxx 50 index of eurozone bluechip stocks is losing 0.07 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is falling 0.28 percent.
The German DAX is losing 0.67 percent and the French CAC 40 is falling 0.37 percent. The UK's FTSE 100 is dropping 0.77 percent and Switzerland's SMI is sliding 0.24 percent.
In Frankfurt, HeidelbergCement is losing 3 percent and Infineon Technologies is dropping 2.5 percent.
Basf and Bayer are declining 2.3 percent and 2.2 percent, respectively. The U.S. Food and Drug Administration issued a complete response letter regarding a supplemental New Drug Application for blood thinner Xarelto, developed jointly by Bayer and U.S.-based Johnson & Johnson.
Volkswagen and BMW are in negative territory, while Daimler is up 0.3 percent.
Gigaset is down 1.1 percent after Deutsche Bank initiated the stock with a "Hold" rating.
Lanxess is falling 4.4 percent, after the firm reportedly received a broker downgrade.
Deutsche Bank is up 0.1 percent and Commerzbank is gaining 0.4 percent.
Deutsche Telekom is advancing 3 percent. Airline Lufthansa is gaining 1 percent.
Equinet raised Fraport to "Buy" from "Accumulate." The stock is gaining 1 percent.
In Paris, Technip is leading the decliners by losing 4.2 percent. EADS is falling 2.4 percent.
Renault and Peugeot are declining 1.6 percent and 1.3 percent, respectively.
Michelin is losing 0.2 percent. Goldman Sachs lifted its rating on the stock to "Neutral" from "Sell."
France Telecom is gaining 2.1 percent. UBS removed the stock from "Least Preferred List."
Credit Agricole is gaining 1.6 percent. Societe Generale is adding 1.3 percent and BNP Paribas is rising 0.3 percent.
S&P Equity raised Vinci to "Strong Buy" from "Buy." The stock is up 0.9 percent.
Berenberg raised Saint Gobain to "Buy" from "Hold." The stock is modestly up.
In London, Michael Page is declining around 6 percent, reportedly on a broker downgrade.
Petrofac is losing 5.5 percent. BP is losing 1.5 percent and Royal Bank of Scotland is falling 1.4 percent.
Despite the news of the downgrade, Barclays is up 0.7 percent, Lloyds Banking is climbing 1.9 percent and Royal Bank of Scotland is up 0.2 percent.
RBS said it disagrees with the Moody's cut, blaming the ratings agency for not acknowledging the bank's improvements properly unlike other rating agencies. Lloyds expects no material effect from the downgrade.
Clariant is losing 2.7 percent in Zurich. The specialty chemicals company plans to increase its EBITDA margin from 13.2 percent in 2011 to above 17 percent in 2015 and achieve a return on invested capital that is above peer group average.
Credit Suisse and UBS are in positive territory.
KPN is losing 3.8 percent in Amsterdam on speculation that Mexico's Carlos Slim may drop the offer on the firm's shares.
In economic news, Germany's business sentiment weakened more than expected in June, reports said citing the latest survey results from Ifo Institute. The business confidence index fell to 105.3 from 106.9 a month ago. Economists were expecting the index to fall to 105.6.
The deterioration in Germany's business confidence reinforces fears of economic stagnation and a possible recession in the near term, Capital Economics Chief European Economist Jonathan Loynes said.
The economist said that the disappointing Ifo survey has dealt a major blow to hopes that strong growth and higher inflation in Germany would help solve the euro-zone crisis.
Across Asia/Pacific, markets ended firmly in the red. Australia's All Ordinaries lost around 1 percent while Hong Kong's Hang Seng retreated 1.4 percent. Japan's Nikkei 225 slid 0.3 percent.
In the U.S., futures point to a higher open on Wall Street. In the previous session, stocks moved sharply lower as a batch of disappointing U.S. economic data inspired traders to cash in on the gains seen over the past two weeks. The Dow plunged 2 percent, the Nasdaq tumbled 2.4 percent and the S&P 500 declined 2.2 percent.
In the commodity space, crude for August delivery is adding $0.41 to $78.56 per barrel and August gold is gaining $3.8 to $1569.3 a troy ounce.
by RTT Staff Writer
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