DAX, CAC, FTSE100, European stocks slide as U.S. banking worries ripple through markets

European equities fell sharply on Friday as renewed concerns over the health of U.S. regional lenders sent shockwaves through global markets.

The selloff was triggered after Zions Bancorporation (NASDAQ:ZION) and Western Alliance Bancorporation (NYSE:WAL) revealed their exposure to alleged borrower fraud, reigniting fears of instability in the credit market.

The DAX in Germany dropped 1.4%, while the FTSE 100 in the U.K. slipped 1.0%. France’s CAC 40 held largely steady, showing minimal movement compared to its peers.

Banking stocks led the declines. Shares of Commerzbank (TG:CBK), Deutsche Bank (TG:DBK), BNP Paribas (EU:BNP), Societe Generale (EU:GLE) and Lloyds Banking Group (LSE:LLOY) all fell as investors assessed potential knock-on effects from U.S. credit market stress.

Automaker Volvo Group (BIT:1VOLC) also tumbled after warning that new U.S. tariffs could dampen demand for heavy-duty trucks in North America in 2025.

Drugmaker Novo Nordisk (NYSE:NVO) slumped as well, following U.S. President Donald Trump’s promise to cut the price of its blockbuster weight-loss drug, Ozempic.

There were bright spots amid the downturn. Pearson (LSE:PSON) shares jumped after reporting a 4% rise in underlying group sales for the third quarter of 2025.

Spanish lender BBVA (NYSE:BBVA) also rallied after its hostile all-stock takeover offer for Banco de Sabadell fell short of the minimum acceptance level, lifting investor sentiment.

Meanwhile, Smiths Group (LSE:SMIN) gained ground after announcing plans to divest or spin off two of its four core business divisions as part of a strategic streamlining initiative.

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