European shares dip as Deutsche Bank overhaul weighs on banks

European shares closed slightly lower on Monday as a massive restructuring plan announced by Deutsche Bank weighed on the wider financial sector and markets remained subdued on dampened hopes of a hefty rate cut by the US central bank.

Upbeat US jobs data last week put off bets that the US Federal Reserve would give in to calls for aggressive policy easing.

"Ordinarily, a strong set of employment data would lift global equity sentiment, but seeing as a large portion of the rally was driven by the belief that the Federal Reserve will cut rates this month, equity markets are broadly lower today," CMC Markets analyst David Madden said.

The pan-European Stoxx 600 index ended the session down 0.05 per cent at 389.9.

Lagarde to lean on Lane at ECB

---

Stressed out: the system is broken and needs a radical fix

---

Turkish lira weakens 2.1% after central bank governor dismissed

---

Ireland’s €205bn debt: So just who is to blame?

---

DUBLIN

The Iseq index dropped 0.4 per cent to 6,315.83, with Bank of Ireland off 3.9 per cent at €4.60 and AIB down 0.4 per cent at €3.67. However, Permanent TSB stood out as a bright feature, rising 5.1 per cent to €1.32.

Property plays in Dublin were broadly lower, amid concerns over the outlook for house prices. Cairn Homes dipped 1.3 per cent to €1.19 and Glenveagh Properties declined by 0.9 per cent to 75c.

"House price inflation has slowed due to Central Bank of Ireland mortgage rules, but the pressure of housing demand on supply has not, evident in a 7 per cent rise in rents through 2018," said Conall Mac Coille, an economist with Davy.

Providence Resources added 3.7 per cent to 11c on news that $10 million due from Chinese backer APEC Energy Enterprises to its Barryroe project off the Cork coast had come through.

LONDON

UK blue-chip index edged 0.1 per cent lower in its third session of losses – its longest losing streak in two months, while the midcaps fell 0.4 per cent as a weaker sterling also weighed on its domestically-exposed constituents.

Imperial Brands helped contain the losses on the blue-chip index, adding 2.2 per cent after the tobacco company announced plans for a £200 million buyback and said it would revise its dividend policy. Rival British American Tobacco rose 1.5 per cent.

Losses in the blue-chip index were spread across sectors, with pharmaceutical companies and banks most hit.

Miners, however, snapped a three-day losing streak on the back of higher copper prices. The sub-index had slipped last week after China’s top steel mills formed a group to probe a record surge in ore prices.

British Airways owner IAG lost 1.4 per cent on news that it was facing a record £183.4 million fine from the UK's Information Commissioner's Office for the theft of data from 500,000 customers from its website last year.

EUROPE

Deutsche Bank erased earlier gains to fall 5.4 per cent to €6.79 after the German lender unveiled plans to restructure its business. Some analysts said challenges for the bank remain and noted the new profitability targets may be too ambitious.

Spanish utilities group Enagas dropped almost 5 per cent after influential brokerages RBC, JP Morgan and Kepler Cheuvreux each downgraded their price targets for the company's stock.

NEW YORK

US stocks were lower in early afternoon trading, pressured by a more than 2 per cent drop in shares of Apple and as investors toned down expectations of an aggressive interest rate cut by the Federal Reserve later this month.

Apple was hit as Rosenblatt Securities downgraded the iPhone maker's shares to sell from neutral, and said it expected the company to face "fundamental deterioration" in the next six to 12 months.

The major sectors trading higher were energy, up on higher oil prices, consumer discretionary and real estate.

Boeing shares fell after Saudi Arabian budget airline flyadeal said it would not proceed with a provisional $5.9 billion order for the planemaker's grounded 737 MAX aircraft, instead opting for a fleet of Airbus A320 jets. – Additional reporting Reuters