UniCredit, Intesa Shares Sharply Lower
Shares in Italian banks UniCredit SpA and Intesa Sanpaolo fell sharply on Friday and were briefly suspended for hitting the daily downward limit under pressure from Europe's debt crisis.
Brokers cited comments from European Central Bank board member Jose Manuel Gonzalez-Paramo on the euro zone debt crisis not being over, German comments on a possible sovereign debt roll-over, and Thursday's Moody's downgrade threat on Italian banks.
"I don't know. We are wondering what's going on. All the banks are being hammered to bits," a trader at a leading Milan bank said.
"I think that some Americans are getting into the office and reading the Moody's report (on Italian banks)," he said.
A second Milan trader cited Moody's decision to cut ratings on Anglo Irish and Irish Nationwide banks as well as a possible poor outcome for some Italian banks in upcoming stress tests.
"It is easy to see that Italian banks are in the sights of everyone," he said.
Earlier on Friday, Intesa had recovered to stand down 1.5 percent at 1.74 euros, while UniCredit was suspended again indicating a fall of 8 percent.
The STOXX Europe 600 banks index was down 0.83 percent.