European Stocks Drop for Second Day; BNP Paribas, SocGen Tumble

European stocks slumped for a second day, dragging the benchmark regional gauge to its lowest level since July 2009, as speculation mounted that Germany is preparing for Greece to default.

BNP Paribas SA, Societe Generale SA and Credit Agricole SA tumbled at least 11 percent after two people with knowledge of the matter said Moody’s Investors Service may cut the banks’ ratings because of their Greek holdings. AXA SA and ING Groep NV lost more than 8 percent as insurers posted the second biggest losses among 19 industry groups on the Stoxx Europe 600 Index.