European shares extend falls, led by banks

London: European shares extended losses on Thursday, led by banks as already weak hopes for decisive action at a European Union summit to tackle the region’s debt crisis dimmed further.

The FTSEurofirst 300 index fell 0.5% to 994.68 points, while the Euro STOXX 50 declined by 0.8%.

The STOXX European banking index led sectoral fallers, down 1.5%, with France’s BNP Paribas and Germany’s Deutsche Bank both down by more than 2%.

“The realisation that the comments and rhetoric from Merkel are probably not pointing towards a coordinated effort to resolve the debt crisis is impacting markets,” said Central Markets senior broker Joe Neighbour.

A German government source on Thursday became the latest official to downplay expectations for the summit.