LLOY down on big losses last year

European equities markets were lower Friday after a deal was announced between the US government and Citigroup (NYSE: C) in which the government will take as much as a 36 percent stake in the bank.

The news made some analysts and investors worry that the deal is a step down the road to nationalization of banks.

In London, the FTSE 100 was 2.18 percent lower to 3,830.09 while the FTSE 250 dropped 1.22 percent to 6,049.14.

Banks and insurers were the top five losers on the 100, with Lloyds Banking Group (LSE: LLOY) turning in the worst performance on the session as it dropped 22.27 percent after it reported a large full-year loss in 2008.

Royal Bank of Scotland (LSE: RBS; NYSE: RBS PRM) dropped 20 percent on the session, while Barclays Bank (LSE: BARC; NYSE BCS; TYO: 8642) was down 17.35 percent.

Among insurers, Aviva (LSE: AV) was down 10.6 percent while Old Mutual (LSE: OML; JSE: OLOML) was 11.7 percent lower.

Miner Xstrata (LSE: XTA) had the best day on the 100 with a gain of 6.26 percent but most miners ended the session lower.

The FTSE Eurofirst 300 fell 2.07 percent to 717.34 while the CAC-40 was down 1.54 percent to 2,702.48 in Paris, Spain’s IBEX was 2.44 percent lower to 7,620.9 and the Dax dropped 2.51 percent to 3843.74 in Frankfurt.

Insurer Axa (Euronext: CS; NYSE: AXA) was the worst performer on the CAC-40 as it dropped 8.29 percent, while Volkswagen (FWB: VOW) was 6.98 percent lower as it led losers on the Dax.

There was only one winner on the Dax as Deutsche Telekom (FWB: DTE; NYSE: DT; LSE: DEU; TYO: 9496) added 0.9 percent on the session.

Asia-Pacific markets were mixed, with more seeing losses than gains.

Tokyo markets were up on the session, but the Nikkei has still dropped 5.3 percent this month as is 14.6 percent lower for the year so far.

The Nikkei 225 added 1.48 percent to 7,568.42 while the Topix index was up 1.91 percent to 756.71 and the Mothers market of small and mid-caps was up 0.07 percent to 297.21.

Exporters saw gains even though the yen strengthened, with Sony (TYO: 6758; NYSE: SNE) adding 2 percent before it announced after the close of trade that its president will resign and its CEO will take up his duties while remaining in his present position as well.

Other gainers on the session included the Kospi, which added 0.78 percent to 1,063.03 while at the same time the Taiex gained 0.85 percent to 4,557.15.

In Australia, the Sydney Ordinaries fell 0.02 percent to 3,296.9 while the S&P/ASX200 dropped 0.03 percent to 3,344.5.

The Hang Seng was down 0.65 percent to 12,811.57, the Shanghai Composite fell 0.71 percent to 8,891.61, the Straits Times Index was 1.4 percent lower to 1,594.87, and the Shanghai Composite dropped 1.81 percent to 2,082.85.

At just before 1:30 p.m. in New York the Dow Jones Industrial Average had fallen 0.37 percent to 7,155.24 while the Nasdaq Composite was down 0.07 percent to 1,390.51 and the S&P 500 had dropped 1 percent to 745.27.

A new report from the Commerce Department that the Gross National Product of the US contracted at an annualized 6.2 percent in the fourth quarter of 2008 hurt the day’s results.

Banks were lower on the news that Citigroup (NYSE: C) and the US government have reached a deal which will give the government a share in the bank.

Citigroup was down 37.8 percent in afternoon trade while Bank of America (NYSE: BAC) was down 18.99 percent at the same time.

Story link: LLOY down on big losses last year