European Markets Close Lower On Financial Stock Woes

London, UK (AHN) - European markets slumped Wednesday as financial shares were battered by concerns over solvency. Lower oil prices boosted auto and airline stocks.

The pan-European Dow Jones Stoxx 600 lost 0.6 percent, dropping to 265. In London, the FTSE 100 fell 1.5 percent to 5,0142. Elsewhere, France's CAC-40 shed 0.6 percent to 4,040 and Germany's DAX 30 slipped 0.2 percent to 6,068.

In stocks, the Royal Bank of Scotland Group dropped 6.8 percent while France's Nataxis investment bank lost 7.5 percent on worries it may have to raise more money. The Swiss Re insurance firm tumbled 7 percent after announcing it had $9.6 billion tied-up in troubled U.S. mortgage lenders Fannie Mae and Freddie Mac.

While financial stocks took a drubbing, auto and airline shares rose after oil prices fell below $138 a barrel. Germany's Volkswagen gained 1 percent and the UK-based easyJet airline rose 1.5 percent.