European Markets Fall On Disappointing Earnings

Most European markets fell Thursday as investor sentiment was dragged down by disappointing earnings reported by companies.

The German DAX 30 index was down 0.53 percent or 34.06 points to 6372.96. Shares of Siemens AG dropped 3.55 percent and shares of Daimler AG fell 1.30 percent.

The French CAC 40 index marginally fell 0.08 percent or 2.42 points to 3079.32. Shares of Peugeot SA dropped 1.05 percent and those of Total SA declined 0.36 percent.

London's FTSE 100 index marginally declined 0.05 percent or 2.88 points to 5495.44. Shares of BT Group PLC dropped 0.98 percent and those of Barclays PLC were down 0.73 percent.

Spain's IBEX 35 fell 0.25 percent or 14.90 points to 5990. Shares of Telefonica SA dropped 4.39 percent and those of Bankia SA declined 0.75 percent.

Royal Dutch Shell, the world's third largest oil and gas company, reported a $5.7-billion profit in the second quarter Thursday, giving the company a 13 percent decrease compared to the same period a year ago.

Siemens AG, Europe's largest engineering company, reported Thursday a profit of 1.23 billion euros ($1.5 billion) in the April-June quarter which was less than the 1.4 billion euros expected by analysts.

Telefonica SA, Europe's biggest phone company, whose borrowing cost has been mounting along with that of Spain, slashed its revenue forecast. Meanwhile, Alcatel-Lucent SA, France's largest phone-equipment supplier, reported the second quarter operating loss 31 million euros down from a profit of 87 million for the same period a year earlier.

Investors continued to worry about the uncertainties in the euro zone economy. Market sentiment is weighed down by the increasing debt pressure on Spain. The 10-year government bond yields in Spain soared to record highs of about 7.56 percent.

Market participants worried that the contagion would spread to Italy. Investors sensed that government bond yields in Italy could continue to rise along with their Spanish counterparts.