European stocks slid, posting the biggest retreat since they began rallying in January, as concern over Greek debt was exacerbated by declines in the U.S. and Asia.
The Stoxx Europe 600 Index lost 1.8 percent to 403.69 at the close of trading, completing the worst week of the year. The Greek ASE Index slid 3 percent, with the National Bank of Greece SA and Alpha Bank AE tumbling more than 7 percent, as the country struggles to win more aid to avoid a default. Germany’s DAX Index plunged 5.5 percent this week, the most since 2011.
European stocks fell for a second day after reaching a fresh peak Wednesday, taking weekly losses to 2.2 percent. The Stoxx 600’s still up 18 percent this year amid European Central Bank stimulus, and trades near the highest level relative to projected profits of its members in at least a decade.
“We’ve become a bit more cautious over the past few months because markets have been rallying pretty rapidly,” said Dirk Thiels, head of investment management at KBC Asset Management in Brussels. “Valuations are pricing in a lot. Stocks are still pretty close to a record.”
The volume of Stoxx 600-listed shares traded was 22 percent higher than the 30-day average, data compiled by Bloomberg show. All 19 industry groups fell.
Greek stocks plunged 6 percent this week for the worst performance among western-European markets. International Monetary Fund Managing Director Christine Lagarde warned on Thursday that she wouldn’t let the country miss a debt payment.
“The major macro thing at play now is the Greek saga,” Thiels said. “There’s a low chance of a Greek exit, but anything between that and a full-fledged rescue is also possible.”
European and U.S. stocks fell with China’s index futures after regulators in the world’s second-biggest economy clamped down on the use of shadow financing for equity purchases and expanded the supply of shares available for short sellers.
Among stocks moving on corporate news, Syngenta AG dropped 4.4 percent after first-quarter sales missed projections. SKF AB tumbled 8.2 percent after reporting profit below estimates. Abertis Infraestructuras SA fell 2.7 percent as an investor sold a stake.