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European stocks dropped as Germany and France disagreed on when to introduce a banking union for the euro area and a report added to concern about the strength of China’s economy.
Anglo American Plc slid 2.6 percent, contributing the most to a decline by a gauge of mining companies. CGGVeritas (GA) tumbled 5.3 percent after agreeing to buy Fugro NV (FUR)’s seismic division for 1.2 billion euros ($1.6 billion). TNT Express NV (TNTE) lost 2.6 percent as the company’s chief executive officer resigned.
The Stoxx Europe 600 Index (SXXP) fell 0.4 percent to 274.7 at the close, its largest drop since Sept. 18. Metal producers, banks and construction companies declined.
German Chancellor Angela Merkel rejected French President Francois Hollande’s appeal to activate oversight of the banking union “the earlier, the better.” The deadlock over regulation may delay into next year a key building block in resolving the single currency’s debt crisis.
In China, manufacturers and retailers are less optimistic about sales than they were three months ago. Previous economic reports showed that manufacturing, trade and retail sales slowed in the third quarter. That pointed to a seventh straight deceleration in quarterly growth and potentially the weakest annual expansion for the world’s second- largest economy in 22 years.
National benchmark indexes fell in every western-European market except Denmark and Iceland.
FTSE 100 5,838.84 -13.78 -0.24% CAC 40 3,497.22 -33.50 -0.95% DAX 7,413.16 -38.46 -0.52%
Stocks extended their retreat today after German business confidence unexpectedly fell for a fifth-straight month in September to the lowest reading since February 2010. The Ifo institute in Munich said its business climate index, based on a survey of 7,000 executives, dropped to 101.4 from 102.3 in August. Economists predicted an increase to 102.5.Anglo American (AAL) sank 2.6 percent to 1,887.5 pence as base metals declined in London and after Bank of America Corp. and Citigroup Inc. both lowered their recommendations for the shares to neutral from buy.
Rio Tinto Group dropped 2 percent to 2,980 pence after Citigroup downgraded the world’s third-largest mining company to neutral from buy. Antofagasta Plc (ANTO) slid 1.3 percent to 1,260 pence and Kazakhmys Plc (KAZ) retreated 2.1 percent to 714 pence.
CGGVeritas slumped 5.3 percent to 24.44 euros after the world’s largest surveyor of oilfields agreed to buy Fugro’s seismic division to benefit from crude producers’ increased spending on offshore exploration. CGG will finance the deal through debt and a share sale. The company said that it will complete the transaction by the end of the year.
Fugro climbed 2.1 percent to 53.48 euros.
Credit Agricole SA (ACA) lost 2.4 percent to 5.71 euros after the Wall Street Journal reported that the French lender will probably need to inject as much as 700 million euros into Emporiki Bank SA before selling the business.
Qinetiq Group Plc (QQ/) rallied 6.5 percent to 182.9 pence for the biggest advance on the Stoxx 600. The defense technology company said its first-half performance was stronger than it had forecast.
Fiat SpA (F) climbed 2.5 percent to 4.60 euros after Chief Executive Officer Sergio Marchionne confirmed the carmaker’s 2012 financial targets.
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