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European stocks declined the most in two weeks amid concern the euro area’s leaders are far from agreeing on a plan to end the region’s debt crisis. Euro-area leaders are scheduled to meet on Oct. 23, with disagreement over the European Central Bank’s role threatening to hinder progress on the banking and economic questions needed to deliver the comprehensive strategy demanded by global policy makers. The German government hasn’t excluded postponing the summit because of stalling negotiations on boosting the firepower of the region’s rescue fund, Die Welt said, citing unidentified people close to the country’s governing coalition.
French President Nicolas Sarkozy flew to Frankfurt for an impromptu meeting last night with German Chancellor Angela Merkel, ECB President Jean-Claude Trichet and International Monetary Fund Director Christine Lagarde. Luxembourg Prime Minister Jean-Claude Juncker, who chairs the group of euro-area finance ministers, indicated the gathering failed to resolve differences. “We are still meeting,” he said as he departed.
National benchmark indexes fell in 16 of the 18 western European markets. The U.K.’s FTSE 100 dropped 1.2 percent, France’s CAC 40 retreated 2.3 percent and Germany’s DAX slipped 2.5 percent.
Banks led losses as the cost of insuring against default on European corporate debt climbed and the yield on Italian 10-year government bonds rose to more than 6 percent for the first time since August. Intesa Sanpaolo, Italy’s second-biggest bank, dropped 9.8 percent to 1.20 euros and UniCredit, the nation’s largest lender, tumbled 12 percent to 84.6 euro cents. France’s Societe Generale SA lost 7.6 percent to 17.97 euros in Paris.
Actelion plunged 9.7 percent to 30.70 Swiss francs, the biggest slump since March 2010, after it said product sales will fall in the low- to mid-single digit range next year in local currencies. The company cited increased pricing pressure and competition in the U.S.
Schneider Electric tumbled 7.6 percent to 41.22 euros. The company trimmed its 2011 profit target for the second time in four months on rising labor costs in emerging economies and said it may cut jobs. Earnings before interest, taxes and amortization will probably account for about 14 percent of revenue this year, down from a July forecast of about 15 percent, it said.
Nokia Oyj rallied 5.5 percent to 4.73 euros after the Finnish maker of mobile phones reported a smaller-than-estimated loss and forecast a profitable quarter for the handset business.
Ericsson AV, the world’s largest maker of wireless network equipment, rose 4 percent to 68.10 kronor after saying third- quarter net income climbed to 3.82 billion kronor ($580 million) from 3.68 billion kronor a year earlier. That topped the 3.66 billion-krona estimate of 21 analysts in a Bloomberg survey.
Home Retail Group Plc climbed 3.9 percent to 103.4 pence after a report showed U.K. retail sales unexpectedly rose 0.6 percent in September, the most in five months. Debenhams Plc, which reported better-than-estimated earnings today, advanced 7.7 percent to 67.6 pence.
Husqvarna AB gained 6.7 percent to 32.02 kronor, the biggest increase since July 2010. The world’s largest maker of powered gardening tools has solved U.S. production problems that have sapped profits this year, acting Chief Executive Officer Hans Linnarson said.
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