European Stocks Edge Lower on Disappointing Chinese Manufacturing Data, Bank Earnings

European shares were lower on Tuesday morning after Chinese manufacturing figures reignited fears of a slowdown in the world's second largest economy and several lenders, including UBS, HSBC and Commerzbank, reported falling profit.

''There is a concern that the recent improvement in the latest Chinese data could well have been a false dawn, and the recent April manufacturing PMI[Purchasing Managers' Index] data would appear to reinforce that,'' Michel Hewson, chief market analyst at CMC Markets, said by e-mail.

The Caixin Chinese manufacturing purchasing managers' index fell to 49.4 in April from 49.7 in March, remaining below the 50 mark which separates contraction from expansion, as total new orders stagnated and new export work fell for the fifth month in a row, according to a release by Markit Economics. The official manufacturing gauge published by the National Bureau of Statistics on Sunday edged down to 50.1 from 50.2.

Swiss lender UBS ( UBS ) plunged more than 6% after reporting a sharp drop in first-quarter net income as "client risk aversion'' hurt its wealth management business. Commerzbank (CBK.DE) shares tumbled 6.8% after it said profit more than halved. Germany's second-largest lender was the biggest decliner on the Euro STOXX 600 index. Deutsche Bank (DB,) the nation's largest, dropped 3.7%.

HSBC ( HSBC ) shares slid 0.9% after the lender said first-quarter profit dropped 18% due to extreme market volatility at the start of the year. Standard Chartered (STAN.L) was also lower in London, with the shares sliding 5.5%. BNP Paribas (BNP.PA) rose in Paris rose 2.2% after reporting profit that beat expectations as the lender was helped by a drop in loan-loss provisions.

Other decliners in London, included the basic resources sector after a drop in commodity prices, with Anglo American (AAL.L) falling 7.6% and Rio Tinto declining 4.6%.

In Frankfurt, Lufthansa (LHA.DE) lost 6.7% after reporting a revenue drop as passengers migrate to low-cost carriers. In Paris, Air France (AF.PA) dropped 4%. Utility Electricite de France (EDF.PA) lost 4%.

The Europe-wide STOXX 600 index fell 0.9% and the euro-region blue-chip STOXX 50 index was down 1.1%. The exporter-heavy DAX in Frankfurt declined 1.4% and the CAC 40 in Paris lost 0.9%. The FTSE 100 in London fell 0.4% as traders returned after a holiday.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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