LONDON (ShareCast) - European banking stocks were under pressure as investors awaited the European Banking Authority's stress test results, which would reveal the true financial strength of 91 banks.
The stress tests results have been the talk of the town lately as it has been engulfed in controversies ranging from comments that the tests have been compromised to the debate about the amount of information which should be made public, without setting off wide-spread panic.
Elsewhere, ratings agency Standard & Poor's (S&P) warned that the US has a 50% chance of defaulting on its debts, raising the urgency to come to a consensus over increasing the debt ceiling. The U.S. House Republicans plan a vote, next week, hoping to raise the governments debt limit by $2.4 trillion through spending cuts, enforcing cap on expenditures and proposing a constitutional amendment to balance the budget.
However, US politicians on Capitol Hill continue to bicker over raising the US debt limit. The plan could win acceptance by the Republican-led House but the Democrat-led Senate is unlikely to support the proposal.
Most of the European indices ended the week lower with the exception of the Dax, which barely made it into the green territory. The Paris CAC is off 25 points (0.7%) at 3,727, while the Frankfurt DAX is up 5 (0.1%) at 7,220.
As expected, banking stocks were trading down. In Paris, shares of BNP Paribas, Societe Generale and Credit Agricole lost more than 1.5%, 2.2% and 3.1% respectively. Deutsche Bank in Germany slipped 1.5%. With the exception of HSBC Holdings, shares of Barclays, Lloyds Banking and Royal Bank of Scotland tumbled lower.
Fashion brand Hugo Boss has its glad-rags on after second quarter post-tax profit surged more than fivefold to 31m. The company raised full-year sales guidance.
Europes biggest carmaker Volkswagen reported record 4.1m deliveries in the first six months in the year and expects to continue outperforming the auto market in the second half. Sales of luxury cars in its Audi division, sport-utility vehicles and sales at its Czech unit Skoda rose 14%.
CAC 40 - Risers
Essilor International (EI) 56.99 +2.30%
Technip (TEC) 72.50 +1.75%
Sanofi (SAN) 55.49 +1.44%
Michelin (ML) 65.29 +1.07%
PPR (PP) 126.40 +1.00%
Publicis Groupe Sa (PUB) 37.37 +0.62%
Peugeot (UG) 29.97 +0.28%
Vivendi (VIV) 17.01 +0.09%
LVMH (MC) 124.80 +0.08%
Pernod Ricard (RI) 67.01 +0.01%
CAC 40 - Fallers
ST Microelectronics (STM) 6.31 -2.97%
Credit Agricole (ACA) 8.50 -2.81%
Natixis SA (KN) 3.14 -2.72%
Lafarge (LG) 38.69 -2.30%
AXA (CS) 13.63 -2.12%
Societe Generale (GLE) 34.81 -1.99%
Schneider Electric (SU) 104.50 -1.83%
Vinci (DG) 39.95 -1.32%
BNP Paribas (BNP) 45.49 -1.23%
GDF Suez (GSZ) 22.94 -1.21%
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