European shares dragged lower by Deustche Bank share slump

European shares are trading in the red Friday as a disappointing earnings update from Deutsche Bank weighs on the markets.

European shares dragged lower by Deustche Bank share slump

European shares are set to end the week on a downbeat tone, with shares falling mid-afternoon Friday. Disappointing earnings from Deutsche Bank are weighing on the indices, while other banks are also in the red.

By 1345 BST, the EUROSTOXX 600 was trading 0.94% lower, while the EUROSTOXX 50 lost 0.96%. Local trading bourse were also negative. The German DAX fell 1.16%, the French CAC was down 1.01% while the Spanish IBEX moved 1.17% into the red.

Deutsche Bank earnings weigh

Deutsche Bank’s earnings update showed the bank posted a third straight annual loss and a worse-than-expected fourth quarter performance. The German bank also said it’s set to miss its 2018 cost-cutting targets by €1 million, due to higher than expected costs during 2017.

Deutsche Bank posted a full year net loss of €0.5 billion, without the US tax change charges, the business would have been in profit. Pre-tax 2017 profits were €1.3 billion, compared with a pre-tax loss of €810 million in 2016.

“Only a charge related to US tax reform at the end of the year meant that we had to post a full-year after-tax loss,” said Deutsche Bank CEO Jon Cryan in the earnings press release. “We believe we are firmly on the path to producing growth and higher returns with sustained discipline on costs and risks.”

Deutsche Bank shares were down 4.67% at €14.08.

Other share movers

Aside from the lower Deutsche Bank shares, other European stocks were also in the red.

Caixabank shares fell 2.63% to €4.25, after the Spanish bank reported fourth quarter profits some 70% lower than in the third quarter.

Nokian Tyres shares slid 7.06% to €38.06, as the winter tyre specialist is being investigated by Finnish police for alleged product testing issues.

Elsewhere Friday, Danske Bank shares rose 1.99% to DKK246.00 after reporting better-than-expected fourth quarter earnings results.

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