Portuguese bank woes weigh on European equities

jueves 7 de agosto de 2014 08:19 GYT
 

* Concerns over Portuguese banks hits Lisbon market

* FTSEurofirst 300 down 0.2 pct

* ECB keeps rates at record lows

By Sudip Kar-Gupta

LONDON, Aug 7 (Reuters) - Persistent concerns about Portugal's banking system hit the Lisbon stock market on Thursday and weighed on European equities, which were also kept in check by tensions between Western powers and Russia.

The European Central Bank (ECB) kept its main interest rate at a record low, but the decision had been widely expected by investors and did not move equity markets.

Lisbon's benchmark PSI-20 index was down 0.8 percent, underperforming the broader, pan-European FTSEurofirst 300 index which eased 0.1 percent to 1,322.24 points.

Traders said the Lisbon market was hit by fears over the state rescue of Portuguese bank Banco Espirito Santo (BES) , which was hit by financial problems associated with its Espirito Santo founding family.

Investors are concerned that lenders who contribute to a bank recapitalisation fund, through which the state injected 4.9 billion euros to carve out a healthy new bank out of BES, may end up paying a chunk of the rescue bill.   Continuación...