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Aug. 2, 2016, 12:15 p.m. EDT

European stocks end in the red as Commerzbank, Italian banks slide

Insult to injury: Credit Suisse, Deutsche Bank booted from key index

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By Carla Mozee and Victor Reklaitis, MarketWatch


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Shares of German lender Commerzbank are being hit hard in Tuesday’s session.

European stocks closed in negative territory Tuesday as bank shares came under pressure, leading the way lower.

The Stoxx Europe 600 /zigman2/quotes/210599654/delayed XX:SXXP +0.90% fell 1.3% to end at 335.47.

Banks: Among banks, shares of Commerzbank AG /zigman2/quotes/200193353/delayed DE:CBK +0.85% sank 9.2% as the German lender warned it won’t hit its target of stable net profit for the full year. Revenue and net profit fell in the second quarter, hurt by negative interest rates and lackluster client activity.

Meanwhile, Italy’s Banca Monte dei Paschi di Siena /zigman2/quotes/202470451/delayed IT:BMPS -1.43%  lost 16%. The shares had rallied during Monday’s session after the bank’s board late Friday approved a privately backed rescue plan for nonperforming loans at the embattled bank.

But BMPS still fared the worst among the 51 banks in the European Banking Authority’s stress tests, released late Friday. The Italian banking sector was highlighted as one of the weaker spots in Europe’s financial landscape.

Italian Prime Minister Matteo Renzi on CNBC on Tuesday acknowledged problems at BMPS, the world’s oldest lender, but said his overall view “is that Italian banks are good.”

Italian bank shares remained under pressure. UniCredit SpA /zigman2/quotes/200769686/delayed IT:UCG +1.07%  dropped 7.2% on Tuesday after a suspension in trading, while Intesa Sanpaolo SpA /zigman2/quotes/206161760/delayed IT:ISP +0.90%  shed 3.8%.

Meanwhile, shares in Deutsche Bank AG /zigman2/quotes/205584254/delayed DE:DBK +1.58% and Credit Suisse Group AG /zigman2/quotes/205269278/delayed CH:CSGN +1.00%   /zigman2/quotes/202835784/composite CS +0.84%  fell 4.8% and 6.2%, respectively, as the stocks face deletion from the Euro Stoxx 50 /zigman2/quotes/210599266/delayed XX:SX5P +0.89%  on Aug. 8. Deutsche Bank shares have dropped 50% this year, and Credit Suisse is down nearly 49%.

See: Credit Suisse, Deutsche Bank being booted from top index is another blow for banks

In the U.K., shares in Barclays PLC /zigman2/quotes/208409333/delayed UK:BARC +2.46%   /zigman2/quotes/206581728/composite BCS +2.24%  and Royal Bank of Scotland PLC    dropped 3.6% and 1.8%, respectively. A U.K. regulator, the Financial Conduct Authority, has proposed a longer deadline before banks no longer have to pay customers compensation for missold Payment Protection Insurance.

“Every time that deadline gets stretched out, that’s just a prolonged headwind that keeps hanging around for the banks,” said Japer Lawler, a market analyst at CMC Markets.

Other movers: Also among the worst performing on the Stoxx 600, Rotork PLC /zigman2/quotes/200372942/delayed UK:ROR +1.01%  shares slid 8% after the maker of industrial valve maker said it foresees lower margins in 2016. Its first-half net profit dropped 32% as low oil prices continued to delay projects and as geopolitical tensions hurt certain markets.

Oil prices on Monday dropped into bear-market territory, and crude oil futures /zigman2/quotes/209726633/delayed CLU26 0.00%  on Tuesday slumped under $40 a barrel.

Equity gainers were led by Direct Line Insurance Group PLC /zigman2/quotes/201952264/delayed UK:DLG -0.40% , which gained 13% after the insurer said it plans a special dividend payment despite a decline in first-half pretax profit.

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National indexes: Germany’s DAX 30 /zigman2/quotes/210597999/delayed DX:DAX +1.34%  dropped 1.8% to 10,144.34.

France’s CAC 40 /zigman2/quotes/210597958/delayed FR:PX1 +0.85%  lost 1.8% to 4,327.99, while the U.K’s FTSE 100 /zigman2/quotes/210598409/delayed UK:UKX +0.52%  dropped 0.7% to end at 6,645.40.

The euro /zigman2/quotes/210561242/realtime/sampled EURUSD +0.1253%  was higher, at $1.1225 from $1.1169 late Monday.

/zigman2/quotes/210599654/delayed
XX : STOXX
442.49
+3.94 +0.90%
Volume: 0.00
April 16, 2021 11:03p
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/zigman2/quotes/200193353/delayed
DE : Germany: Frankfurt
4.99
+0.04 +0.85%
Volume: 18,816
April 16, 2021 8:59p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
N/A
Rev. per Employee
€166,016
loading...
/zigman2/quotes/202470451/delayed
IT : Italy: Milan
1.17
-0.02 -1.43%
Volume: 2.45M
April 16, 2021 5:35p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
€1.15 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/200769686/delayed
IT : Italy: Milan
8.52
+0.09 +1.07%
Volume: 15.43M
April 16, 2021 5:35p
P/E Ratio
N/A
Dividend Yield
1.41%
Market Cap
€18.91 billion
Rev. per Employee
€257,068
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/zigman2/quotes/206161760/delayed
IT : Italy: Milan
2.30
+0.02 +0.90%
Volume: 88.40M
April 16, 2021 5:35p
P/E Ratio
11.47
Dividend Yield
1.56%
Market Cap
€44.14 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/205584254/delayed
DE : Germany: Frankfurt
10.40
+0.16 +1.58%
Volume: 48,346
April 16, 2021 8:59p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
N/A
Rev. per Employee
€417,912
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/zigman2/quotes/205269278/delayed
CH : Switzerland: SWX
CHF 9.90
+0.10 +1.00%
Volume: 10.38M
April 16, 2021 5:31p
P/E Ratio
9.40
Dividend Yield
1.01%
Market Cap
CHF23.59 billion
Rev. per Employee
CHF621,202
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/zigman2/quotes/202835784/composite
US : U.S.: NYSE
$ 10.85
+0.09 +0.84%
Volume: 5.59M
April 16, 2021 4:00p
P/E Ratio
9.94
Dividend Yield
0.95%
Market Cap
$25.58 billion
Rev. per Employee
$668,207
loading...
/zigman2/quotes/210599266/delayed
XX : STOXX
3,417.15
+30.04 +0.89%
Volume: 0.00
April 16, 2021 11:03p
loading...
/zigman2/quotes/208409333/delayed
UK : U.K.: London
189.18 p
+4.54 +2.46%
Volume: 61.81M
April 16, 2021 4:35p
P/E Ratio
N/A
Dividend Yield
0.53%
Market Cap
£31.52 billion
Rev. per Employee
£332,602
loading...
/zigman2/quotes/206581728/composite
US : U.S.: NYSE
$ 10.50
+0.23 +2.24%
Volume: 3.31M
April 16, 2021 4:00p
P/E Ratio
N/A
Dividend Yield
0.52%
Market Cap
$43.48 billion
Rev. per Employee
$426,514
loading...
/zigman2/quotes/200372942/delayed
UK : U.K.: London
360.00 p
+3.60 +1.01%
Volume: 1.41M
April 16, 2021 4:35p
P/E Ratio
33.68
Dividend Yield
1.75%
Market Cap
£3.11 billion
Rev. per Employee
£177,807
loading...
/zigman2/quotes/209726633/delayed
US : U.S.: Nymex
$ 51.42
0.00 0.00%
Volume: 0.00
April 16, 2021 5:05p
loading...
/zigman2/quotes/201952264/delayed
UK : U.K.: London
302.20 p
-1.20 -0.40%
Volume: 4.51M
April 16, 2021 4:35p
P/E Ratio
11.85
Dividend Yield
7.31%
Market Cap
£4.08 billion
Rev. per Employee
£307,005
loading...
/zigman2/quotes/210597999/delayed
DAX
DX : Xetra Indices
15,459.75
+204.42 +1.34%
Volume: 82,757
April 16, 2021 6:30p
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/zigman2/quotes/210597958/delayed
FR : France: Euronext Paris
6,287.07
+52.93 +0.85%
Volume: 85,545
April 16, 2021 6:05p
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/zigman2/quotes/210598409/delayed
UK : FTSE UK
7,019.53
+36.03 +0.52%
Volume: 0.00
April 16, 2021 4:58p
loading...
/zigman2/quotes/210561242/realtime/sampled
US : Tullett Prebon
1.1982
+0.0015 +0.1253%
Volume: 0.0000
April 16, 2021 4:59p
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Carla Mozée is a reporter for MarketWatch, based in London. Follow her on Twitter @MWMozee. Victor Reklaitis is a London-based markets writer for MarketWatch. Follow him on Twitter @VicRek.

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