S&P 500 2,441.20 17.28
Gold$1,224.80 $5.30
Nasdaq 6,253.81 61.92
Crude Oil $60,490.00      $-1570.00
Market Update

European Markets Drop After HSBC, UBS and Commerzbank Disappoint

Author: Lucy Stoeva
Last Update: 1:16 PM ET May 03 2016

4:00 PM Frankfurt, Germany - European stocks declined on Tuesday after banks reported weaker-than-expected earnings while mining companies retreated on lower metal prices. Commerzbank said net dropped 52%. UBS said first-quarter profit sharply fell due to weakness in wealth management. HSBC posted a decline in profits.

European stocks declined on Tuesday as weak earnings reports hit the banking sector, while mining companies retreated on lower metal prices.

In Germany, Commerzbank lost 9% after posting a decline of 52% in first-quarter profit due to the low interest rates and the volatile capital markets.

HSBC, the largest bank in Europe, fell 1.4% despite the bank reporting a smaller-than-expected decline in profit and the bank announced 1,000 job cuts worldwide.

In Switzerland, UBS sank 7.8% after the first-quarter profit sharply fell to 707 million Swiss francs from almost 2 billion francs a year ago, mainly due to weakness in its wealth management unit.

In France, BNP Paribas eased 0.2% after the biggest French bank said net income rose 10%, despite the unfavorable environment and a revenue drop of 2%.
Base metal prices fell after Chinese factory output contracted for the 14th month in a row in April.

Anglo American stock plummeted 12.8%, Antofagasta lost 7.8%, BHP Billiton erased 6.2%, and Glencore fell 8%.

Among the few gainers, Solvay jumped 3.7% after reporting better-than-expected first-quarter results, as cost cuts offset the lower prices.

In London, the FTSE 100 index lost 49.10, or 0.79%, to 6,192.79, while in Frankfurt, the export-oriented DAX index dropped 181.84, or 1.80%, to 9,941.43.

In Paris, the CAC 40 index fell 62.78, or 1.41%, to 4,379.97.

BMW AG tumbled 4.6% to 77.89 after the luxury auto maker warned of its full-year outlook and said the company faced difficulties in halting declining sales in the U.S. while dealing with uncertainties in China and Europe.

BMW said quarterly net profit increased 8.2% to 1.64 billion despite 0.3% decline in revenues to 20.85 billion from the same period a year ago. Vehicle sales increased 6% in the quarter.

BNP Paribas SA shed 0.2% to 45.85 after the largest French bank said net income rose 10% to 1.8 billion from a year ago on revenue drop of 2% to 10.8 billion.

Last month the bank announced restructuring of its investment banking business and announced 650 job cuts.

Commerzbank AG lost 9% to 7.36 after the German bank posted a decline of 52% in first-quarter profit due to the low rate environment and the volatility of the capital markets.

Revenue before loan-loss provisions declined to 2.3 billion from 2.8 billion a year ago.

On the positive side, the quality of loans improved and loan-loss provisions declined to 148 million from 158 million a year ago.

Deutsche Lufthansa AG sank 5.5% to 12.98 after the German airline said it may cut its capacity expansion plan and restructure its air-cargo unit to offset lower prices.

Lufthansa cut full-year capacity growth to 6% from 6.6% and the airline would consider additional downsizing, including suspension of some routes.

The airline posted a loss before interest and taxes of 53 million for the three months ended March 31, while revenue declined 0.8% to 6.9 billion from a year ago.

  1  2
Sources: Data collected by 123jump.com and Ticker.com from company press releases, filings and corporate websites. Market data: BATS Exchange. Inc