European Stocks Fall

Higher oil prices and disarray in the EU over budgets after last week's failed meeting sent major indexes lower

European stock markets were lower on Monday. In London, the Financial Times-Stock Exchange 100 index fell 5.6 points to 5072. August Brent crude oil futures prices rose on speculation. 70 FTSE stocks fell and 31 rose on turnover of 1,151,000,000 shares. Yields on 10-year gilts rose to 4.40% from 4.39% yesterday. Sterling was off at $1.8229.

Among stocks moving, James Beattie rose after House of Fraser said it may make a takeover offer. TSB Group fell after the company said it would take a higher first half charge for consumer bad-debt provision. Vodafone Group fell after ING Wholesale Banking cut its rating on stock to hold from buy. British Airways and EasyJet fell. BP and Shell Transport rose on higher oil prices.

In Germany, the DAX Index lost 17.71 points to 4586.86 on higher oil prices and disarray in the European Union over budgets after last week's meeting. 23 DAX stocks fell and 7 rose on turnover of 77,367,000 shares. Yields on 10-year Bunds, down at the outset, were finished flat at 3.28%. The euro was off at $1.2146.

Linde fell after Credit Suisse First Boston cut its rating on the stock to underperform from neutral. Colonia Real Estate rose after agreeing to buy 94% of Vega Investments' residential property business Grasmus Holding for an undisclosed price. KarstadtQuelle, in talks to sell sell 75 smaller department stores, rose. Deutsche Lufthansa and BASF fell on higher oil prices.

France's CAC 40 fell 27.51 points to 4193.40 on the EU budget and political crisis following a failed ministers' meeting in Brussels. 35 CAC stocks fell, 4 rose on turnover of 97,438,000 shares. Yields of 10-year bonds, after rising at outset, were flat at 3.29%.

Michelin & Cie fell after problems with the company's tires led seven Formula One teams to pull out of the U.S. Grand Prix. Thomson fell after Exane BNP Paribas downgraded the stock to underperform from neutral. Establissements Maurel & Prom rose on higher oil prices.

Asian markets were mixed on Monday. In Japan, the Nikkei 225 fell 30.68 points, or 0.27%, to 11,483.35. Stocks in Tokyo slid on profit taking after a six-day winning streak. The TOPIX index eased 1.68 points, or 0.14%, to 1170.65, slightly outperforming the Nikkei 225. The broader market showed the first section of the Tokyo Stock Exchange was 836-666 positive. Automakers and other exporters, which led the market higher last week, suffered losses. Meanwhile, gains in oil-related plays, on the back of strength in crude prices, provided downside support for the market.

In Hong Kong, the Hang Seng rose 33.74 points, or 0.24%, to 13,945.77. The Hong Kong stock market bucked weakness elsewhere in Asia, finishing modestly higher. Advancers outpaced decliners on the Hang Seng Index by 14 to 10. Sentiment was boosted partly by resilience on Wall Street in the face of higher oil prices. At home, Bank of Communications priced its IPO at the high end of its targeted range given a strong response from investors.

Canada's benchmark TSX/S&P gained 50.54 points, or 0.51%, to close at 9,998.11.

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