European stocks fell on Tuesday as investors evaluated a series of corporate results and comments from European Central Bank policymakers regarding interest rate expectations. The Stoxx 600 index dropped by 0.4% by 0718 GMT, impacted by declines in the mining and banking sectors of 1.8% and 1.5%, respectively, while the food and beverage index rose by 0.2%.
Concerns about the banking sector resurfaced after First Republic Bank announced that its deposits had fallen by more than $100 billion in the last quarter and that it was considering options such as restructuring its balance sheet. Additionally, UBS Group's shares fell by 2.8% after it allocated more funds to settle its relationship with high-risk mortgages, which significantly affected its profits in the first quarter.
European Central Bank official Philip Lane stated in a French newspaper that "the central bank will need to raise interest rates again at the upcoming monetary policy meeting," while ECB Executive Board member Isabel Schnabel told Politico that "raising the interest rate by 50 basis points is not on the table."
