European stocks extend losses, eyes on Spain; DAX down 0.63%

Investing.com - European stocks extended losses on Monday, after weak German business confidence data added to concerns over the worsening of the euro zone's debt crisis, while investors awaited further indications on whether Spain is about to ask for a full scale sovereign bailout.

During European afternoon trade, the EURO STOXX 50 tumbled 0.95%, France’s CAC 40 plumged 1.07%, while Germany’s DAX 30 dropped 0.63%.

Data showed earlier that German business confidence in September deteriorated to the lowest level since March 2010, amid ongoing concerns over euro zone’s debt crisis.

In a report, the German research institute, Ifo said its Business Climate Index fell by 0.9 point to a seasonally adjusted 101.4 in September from a reading of 102.3 in August. Analysts had expected the index to ease up by 0.2 points to 102.5 in September.  

Markets were also jittery as Madrid is to present its draft budget for next year and announce structural reforms on Thursday, while the results of bank stress tests are due on Friday. In addition, ratings agency Moody’s is expected to complete a ratings review on Spain later this week.

Over the weekend, Spain’s economy minister said the country would not rush to seek external financial aid, as pressure mounted on Spain to seek a bailout.

Financial stocks remained broadly lower, as shares in Germany's Deutsche Bank and Commerzbank tumbled 1.60% and 4.51%, while French lenders BNP Paribas and Societe Generale plummeted 1.34% and 1.36% respectively.

Peripheral lenders also posted sharp losses, with Italian banks Unicredit and Intesa Sanpaolo plunging 1.45% and 2.07%, while Spain's Banco Santander and BBVA plummeted 1.76% and 1.83%.

Meanwhile, Syngenta trimmed gains, but still added 0.20% after the agrochemicals giant increased its target for sales in 2020 by USD3 billion, as it accelerates the introduction of new technology and benefits from a reorganization.

In London, commodity-heavy FTSE 100 slumped 0.50%, weighed by losses in mining and oil stocks.

Mining giants Rio Tinto and BHP Billiton plunged 1.94% and 1.49%, while steel producer Evraz lost 4.01%. Separately, Citigroup downgraded Rio Tinto to neutral from buy.

Oil giant Anglo American was also on the downside, with shares plummeting 3.33%, while rival group BP gained 0.36% amid ongoing reports that it may buy a stake in Russian state-controlled peer Rosneft.

Elsewhere, U.K. lenders continued to track their European counterparts lower. Shares in HSBC Holdings fell 0.41% and Lloyds Banking tumbled 1.01%, while Barclays and the Royal Bank of Scotland retreated 1.84% and 2.32%.

In the U.S., equity markets pointed to a lower open. The Dow Jones Industrial Average futures pointed to a 0.36% fall, S&P 500 futures signaled a 0.38% decline, while the Nasdaq 100 futures indicated a 0.30% loss.

Meanwhile, concerns over Greece persisted as Athens prepared to present a package of spending cuts demand by international lenders to euro zone officials at the end of this week, amid fears that the country’s budget shortfall could be larger than expected.