European shares tumble

European shares fell on Monday, weighed down by banks, oil stocks and a fall in Fingerprint Cards after the firm's former CEO and a board member were arrested. The pan-European STOXX 600 .STOXX index fell 0.4 percent, extending last week's drop to its lowest close since December 29 as equity markets reacted to Friday's inauguration speech by US President Donald Trump, which struck a protectionist tone.
Britain's blue-chip FTSE index fell 0.7 percent, down after the pound rose to a one-month high against the dollar. Trump's speech punctured optimism over the US economy spurred by his earlier promises of tax cuts and other stimulus.
Hopes of fiscal stimulus in the United States lifted the STOXX to 12-month highs at the start of January but growing worries over whether Trump will deliver on that policy have caused the index to fall back.
"The market's response to Trump's speech was one of disenchantment," BayernLB analyst Alexander Aldinger said.
"Even though the speech was radical for the inauguration of an American president, it was relatively moderate by Trump's standards. Its focus was on his 'America first' policy."
Trump reiterated protectionist sentiments at a meeting with company leaders on Tuesday, repeating his pledge to impose a hefty border tax on firms that want to import products to the United States after moving American manufacturing facilities abroad.
Swedish biometric technology firm Fingerprint Cards was the biggest faller on the STOXX 600 index, dropping 7.5 percent after the Swedish Economic Crime Authority took board member Lars Soderfjell and former CEO Johan Carlstrom into custody for alleged market abuse.
Insurer Generali, however, rose 3.9 percent following a report in Italian daily La Stampa on Saturday about bank Intesa Sanpaolo and Germany's Allianz being interested in Italy's biggest insurer.
Analysts played down chances of a deal but traders said the rumours highlighted that Generali's share price valuation was cheap.
"We are sceptical regarding these press rumours, given the high risks associated with the merger of activities in different sectors and with limited potential for value creation," Banca Akros said in a note.
Intesa and Allianz declined to comment.
Allianz fell 1.1 percent, while Intesa fell 2.9 percent, helping drag the European banking sector down 1.2 percent.
Oil stocks, however, were the biggest sectoral losers, down 1.4 percent as the price of oil slid. Miner Antofagasta rose 3.6 percent, leading the basic resources sector 0.9 percent higher. Citigroup upgraded its rating on Antofagasta to a "buy", citing a positive impact from potential lower taxes in the future.