European banks: Still stressed out

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Stress-test results do little to dampen worries about Italy’s lenders

ANY big announcement about banks made after the markets close for the weekend is bound to bring back dark memories of the 2007-08 financial crisis. Although the results of the latest European bank stress tests, released on July 29th, contained much that was reassuring, they did not dispel investors’ doubts about the industry’s earnings prospects. And in the case of Italy, the tests seemed to exacerbate bigger worries. When the markets opened again on August 1st, they were marked by falls in banks’ share prices; the Euro Stoxx banks index dropped by 3% and almost 5% on successive days.
In aggregate the results suggested that European banks were in a healthier position than when the last exercise was conducted, in autumn 2014. This time the banks began with an average “fully-loaded” capital ratio of 12.6% and ended with one of 9.2% in the tests’ most adverse scenario; that compares …

Apple’s third-quarter earnings call – as it happened

Apple signaled to Wall Street that the worst of the iPhone decline is behind it, as it reported another slump in smartphone sales on Tuesday.

The Cupertino-based company has come under pressure to prove that its flagship product can grow again after reporting a 15 per cent drop in iPhones sold in the three months to June. Overall revenues fell 15 per cent to $42.4bn, with net income down 27 per cent to $7.8bn.

Nonetheless, Luca Maestri, Apple’s chief financial officer, said that iPhone sales fell at a slower rate than they had done in March, which he said had “turned out to be the low point for our cycle”. Apple shares rose 5 per cent after-hours on the more positive outlook.

Follow Tim Bradshaw and Richard Waters as they report live reaction to the results and commentary from Tim Cook, Apple chief executive, and Mr Maestri on the conference call with analysts.
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