European Shares End Lower, Pressured by Spain
European shares fell on Tuesday as uncertainty about a potential Spanish sovereign bailout kept the country's debt yields high and prompted investors to continue booking profits on a stellar two-month run for euro zone banks.
Spain has yet to put in a request for international help—which it needs to do before the European Central Bank can start buying its bonds and help ease tensions in the debt market, and said on Tuesday it was still considering the terms.
That continued to give some investors an excuse to take profits on the banking sector, which has risen nearly 50 percent since late July, when ECB President Mario Draghi pledged to defend the euro. On Tuesday it shed 2.7 percent.
"ECB's (intervention) is subject to Spain asking... for a bailout; until then there will be volatility," Manish Singh, head of investment services at Crossbridge Capital, said. "I will buy the dips to add to positions. I think Spain will have to accept their fate and bite the bailout bullet."
The pan-European FTSEurofirst 300 closed 0.2 percent lower to 1,114.39, further retreating from 14-month highs hit on Friday, on the back of monetary intervention expectations from the ECB and U.S. Federal Reserve.
