By Barbara Kollmeyer and Aude Lagorce
MADRID -- European stocks fell on Monday, led lower by Irish banks and on the heels of big losses in China amid somewhat lower volumes with London closed for a bank holiday.
The pan-European Dow Jones Stoxx 600 Index fell 0.7% to 235.95, while the French CAC-40 Index slid 0.9% to 3653.54 and the German DAX Index eased 1% to 5464.61.
China's stock market fell more than 6% on supply worries, leading a retreat in Asian shares.
Irish banks were some of the top decliners in the Stoxx 600. Shares of Allied Irish Banks fell 5.6% and Bank of Ireland slumped 8.9% following a news report that the Irish government may cut initial payments to lenders under a plan to buy €90 billion ($129 billion) of loans from them.
There was little news on the corporate front. L'Oreal /zigman2/quotes/204720038/delayed FR:OR +1.03% fell 1.2% after ING downgraded it to "sell" from "hold."
In the pharmaceutical sector, Sanofi-Aventis /zigman2/quotes/206928357/delayed FR:SAN -1.30% declined 1.8% after a study showed that AstraZeneca /zigman2/quotes/203048482/delayed UK:AZN -0.37% 's Brilinta blood-thinning pill works better than Plavix from Sanofi and Bristol-Myers Squibb /zigman2/quotes/202559280/composite BMY +1.71% .
The study, published in the New England Journal of Medicine, shows the AstraZeneca pill produced a 16% drop in heart-attack and stroke deaths among patients. AstraZeneca now plans to file for regulatory approval for Brilinta during the final quarter of the year. The drug could be available as soon as the end of 2010. Shares of AstraZeneca rose 2.1% in Stockholm.
In Paris, Wendel /zigman2/quotes/204487539/delayed FR:MF -0.84% lost 7% after the French investment company swung to a first-half net loss and investors became concerned over the narrow gap between its share price and net asset value.
Altran declined 8.2% after the French consulting group swung to a first-half net loss, pulled down by restructuring and depreciation charges.
In Germany, Deutsche Post /zigman2/quotes/207090990/delayed DE:DPW +1.05% fell 1.8% after Commerzbank cut the stock to "neutral" from "add." The broker noted that while the company is well placed to benefit from a potential economic recovery, shares have already risen 80% over the past six months. It added that earnings in the mail unit are at risk due a structural decline in volumes, potential loss of VAT-exemption, the re-emergence of competition and a possible cancellation of minimum wages.
On the economic front, consumer prices in the euro zone fell 0.2% on the year in August, according to an initial estimate issued by Eurostat, compared with a 0.7% fall in July. No detailed breakdown of the data was available.