European stocks fall on lender's announcement
European stocks fell after Deutsche Bank AG Chief Executive Officer Josef Ackermann said Germany's biggest bank "made mistakes" that will force it to write down the value of leveraged loans and scale back hiring.
Deutsche Bank shares dropped the most in two weeks. Societe Generale SA, France's second-biggest bank, and UBS AG of Switzerland paced the decline.
The Dow Jones Stoxx 600 Index sank 0.5 percent to 375.54 as of 8:02 am in London, with banks accounting for the biggest losses. The Stoxx 50 declined 0.7 percent, while the Euro Stoxx 50, a measure for the euro region, slipped 0.8 percent.
"It's quite normal that investors take some profits after the good run we had in the past two days," said Herbert Perus, who helps oversee the equivalent of $57 billion as head of global equities at Raiffeisen Capital Management in Vienna. "There's a bumpy road ahead."
Asia, US
Asian stocks rose to a seven-week high yesterday. US stocks extended their biggest rally in four years yesterday, buoyed by speculation Federal Reserve interest-rate cuts will help contain the housing slump and spur profit growth.
Deutsche Bank retreated 2.6 percent to 91.75 euros.
Societe Generale dropped 1.3 percent to 119.7 euros. UBS, Switzerland's largest bank, retreated 1.2 percent to 63.65 Swiss francs.
Delta (Two) Ltd., a fund backed by the Persian Gulf emirate, revised its proposal for London-based Sainsbury, the companies said today. The bid remains at 600 pence per share, the same as Delta's first offer to the board in July.
Metro AG rallied 4.9 percent to 65.90 euros. Germany's largest retailer plans to replace Chief Executive Officer Hans- Joachim Koerber with Eckhard Cordes at the end of October, Sueddeutsche Zeitung said, citing unidentified people at the company.
Metro spokesman Juergen Homeyer and Haniel spokeswoman Jutta Stolle both declined to comment.
Air Berlin Plc climbed 4.3 percent to 13.65 euros. Europe's third-largest low-cost carrier agreed to buy 75.1 percent of smaller competitor Condor Flugdienst GmbH from Thomas Cook AG.
Air Berlin will buy the remaining 24.9 percent of Condor in February 2010, after Thomas Cook acquires that stake from Deutsche Lufthansa AG, Air Berlin said.
Separately, Financial Times Deutschland said Thomas Cook Group Plc, the travel company formed by the merger of Thomas Cook AG and MyTravel Group Plc, is negotiating the purchase of a stake in Air Berlin.
Bloomberg News
(China Daily 09/21/2007 page16)