European equities drop for sixth straight session

 

Eurostoxx 50: 2,752.06 (–22.44) Frankfurt DAX: 7,060.23 (–43.02) Paris CAC: 3,837.98 (–33.94)EUROPEAN STOCKS dropped for a sixth day yesterday, their longest losing streak since March, after Federal Reserve chairman Ben Bernanke gave no hint that the central bank will unveil a new round of stimulus.

UK stocks extended their loses as Moody’s Investors Service said the country’s Aaa credit rating will be at risk if the government misses its debt reduction targets.

The Stoxx Europe 600 Index slid 1.1 per cent to 269.01.

“It looks like this correction will continue for some time until we have better macro news out of the US and more certainty on Europe’s debt problems,” said Matthias Fankhauser, a fund manager at Clariden Leu in Zurich. “What Bernanke said was quite a disappointment, and reports that Moody’s may change its view on the UK may put pressure on prices as some investors may trade on this information,” he said.

UBS fell 2.1 per cent to 15.32 Swiss francs as the Financial Times reported that the bank plans to raise pay to help recruit and retain senior employees following departures from its investment banking unit.

BHP Billiton, the world’s largest mining company, dropped 2 per cent to 2,295p as copper and aluminium fell for the first time in four days on the London Metal Exchange.

Rio Tinto slid 1.2 per cent to 4,147p.

Kabel Deutschland sank 5 per cent to €42.23 after saying its full-year net loss widened as television customers taking up internet and phone services did not make up for costs from refinancing debt.

Nokia Oyj declined 4.2 per cent to €4.29 after Sanford Bernstein reiterated its underperform rating on the stock. Shares in the Finnish mobile phone maker have plunged 45 per cent this year.

Saab fell 8.4 per cent to 136.50 kronor, its biggest drop in more than a year, as BAE Systems, Europe’s largest defence contractor, sold its remaining stake in the Swedish weapons maker for about $253 million.

BAE’s shares dropped 1.1 per cent to 319.5p.

Lloyds Banking gained 2.3 per cent to 48.7p. The British government will change the rules of its credit guarantee scheme to allow banks an early exit from the emergency support programme.

Pandora jumped 4.6 per cent to 171.60 kroner. – (Bloomberg)