Emblems for the Porsche cars are placed in a box at the production line of the German car manufacturer’s plant in Stuttgart-Zuffenhausen (file). Volkswagen has faced new accusations in the ever-widening emissions cheating scandal, but the German auto giant adamantly denied the new charges.

AFP/London


Disappointing results from Britain’s emerging markets bank Standard Chartered and the mushrooming scandal at Germany’s troubled automaker Volkswagen dominated trading in Europe yesterday.
StanChart said it sank into the red in the third quarter with an unexpected pre-tax third-quarter loss of $139mn, and outlined surprise plans to raise $5.1bn in fresh capital to bolster its finances.
Volkswagen meanwhile faced new accusations in the ever-widening emissions cheating scandal, but the German auto giant adamantly denied the new charges.
“Sentiment (was) dominated by the return of the Volkswagen story and the surprise bringing forward of a rights issue by Standard Chartered Bank after the bank slumped to a surprise Q3 loss,” said analyst Michael Hewson at traders CMC Markets.
By late afternoon European markets had recovered, with London’s FTSE gaining 0.34% to 6,383.61 points.
In the eurozone, Paris’s CAC 40 index closed with a gain of 0.41% at 4,936.18 points, while Frankfurt’s DAX 30 ended the day flat at 10,951.15 points.
StanChart shares slumped 6.67% to finish the day at 666 pence in London, after the bank also announced plans to axe 15,000 jobs worldwide.
The job losses are part of a major restructuring that will cost around $3.0bn, the bank said.
“With Standard Chartered announcing a monster rights issue and slashing jobs, investors are heading for the exits in droves,” said Mike McCudden, head of derivatives at stockbroker Interactive Investor.
Across in Frankfurt, Volkswagen shifted into reverse after US regulators accused it late Monday of fitting illegal “defeat devices” into its larger 3.0 litre diesel engines.
The German auto giant, which adamantly denied the new charges, saw its share price initially nosedive 5%, but pared the loss to close down 1.51% at €111.
In an affair that has rocked the automobile sector around the world since it broke in September, the carmaker has already admitted using the software, which skews the results of pollution tests, in smaller 2.0 litre diesels equipped in some 11mn cars worldwide.
But the US Environmental Protection Agency said late Monday it had discovered in its investigation that various six-cylinder 3.0 litre diesel VW Touareg, Porsche Cayenne and Audis had also been rigged with the software.
Meanwhile, Europe’s banking sector remained under pressure from the Standard Chartered news.
British peer Barclays fell 1.08% to 233.50 pence and Lloyds Banking Group dropped 0.71% to 74.47 pence.
In Paris, French pair BNP Paribas and Societe Generale saw their shares drop 0.07% and 0.50%, to stand at €55.31 and €42.51 respectively.
The “A” shares in Shell shot up 2.96% to 1,056.50 pence after the oil company said it had identified another $1.0bn in savings from its BG Group takeover and unveiled a new overhaul to combat a “prolonged downturn” in oil prices.
US stocks pushed higher, with the Dow Jones Industrial Average climbing 0.49% to 17,916.01 points in midday trading.
The broad-based S&P 500 added 0.09% to 2,105.89, while the tech-rich Nasdaq Composite Index rose 0.15% to 5,134.96.
In foreign exchange activity, the European single currency slid to $1.0947 from $1.1014 late in New York on Monday.