FILE PHOTO: The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, August 7, 2023. REUTERS/Staff/File Photo
European shares experienced a decline on Tuesday due to pressure on Italian banks after the cabinet approved a 40-percent windfall tax on lenders. Additionally, sticky inflation print from Germany and weak China trade data further dampened risk sentiment.
By 0707 GMT, the pan-European STOXX 600 index had decreased by 0.3 percent.
Intesa Sanpaolo and UniCredit, among other Italian banks, fell more than 5 percent after Deputy Prime Minister Matteo Salvini announced the implementation of a 40 percent levy on banks’ extra profits. This levy aims to support the reduction of the tax burden, tax cuts, and financial assistance for holders of mortgages on first homes.
Italy’s banking-heavy FTSE MIB slid by 1.4 percent, while European banks dropped by 1.8 percent following ratings agency Moody’s decision to downgrade the credit ratings of several small- to mid-sized U.S. banks. Moody’s also stated the possibility of downgrading some of the largest lenders in the United States.
Germany’s DAX index fell by 0.4 percent after data revealed a 6.5 percent acceleration in inflation in July, aligning with economist expectations.
Miners and automakers with exposure to China experienced a decline as data showed that imports and exports in the world’s second-largest economy fell faster than expected in July. This development poses a threat to growth prospects and increases pressure on Beijing to provide additional stimulus.
Shares of Glencore slumped nearly 3 percent after the global miner reported a 50 percent decrease in earnings for the first half.
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Denial of responsibility! Vigour Times is an automatic aggregator of Global media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, and all materials to their authors. For any complaint, please reach us at – [email protected]. We will take necessary action within 24 hours.
