German stocks retreated for a second day, as falling commodity prices amid rising tensions between China and Japan over a worsening territorial dispute in the East China Sea and renewed worries over Spain's financial woes weighed on the market.
Meanwhile, Germany's economic sentiment improved in September after easing for four straight months, the Mannheim-based ZEW said today. The ZEW Indicator of Economic Sentiment rose 7.3 points to -18.2, but the negative reading indicates that the financial market experts expect the German economy to lose momentum over the next six months.
The German DAX is currently down 72 points or 0.97 percent at 7,332, while France's CAC 40 is losing 1.3 percent and the U.K.'s FTSE 100 is down 0.6 percent.
The euro fell from a four-month high against the dollar on concerns about divisions in proposals toward a European banking union. The European Central Bank will assume the role of a banking supervisor only if it is fully equipped, ECB Governing Council member Ewald Nowotny reportedly said. He said it is ambitious to expect the ECB to take on the responsibility of overseeing major banks by mid-2013.
In stock-specific action, Deutsche Bank is tumbling 3.6 percent on a brokerage downgrade, while rival Commerzbank is moving down 3.8 percent.
Automakers Daimler, BMW and Volkswagen are down 1-2 percent after data released by the European Automobile Manufacturers' Association showed registrations of new passenger cars in Europe dropped at a faster rate in August.
Merck KGaA is losing 1.4 percent as it decided to voluntarily withdraw European filing for its cancer drug Erbitux.
Elsewhere, Asian markets fell broadly, with commodity-related shares pacing the decliners, weighed down by mounting worries over Spain's sovereign debt and concerns over U.S. economic growth. Commodities are extending declines and the U.S. stock futures point to a tepid start despite a well-received Treasury auction by Spain.
by RTT Staff Writer
For comments and feedback: email@example.com