European stocks drop

Munich Re was among the stocks which fell as the DAX index. European stock markets dropped in morning trading on Monday, with the banking and insurance sectors lower in the wake of some disappointing earnings updates. London\'s benchmark FTSE 100 index fell 0.32 percent to 5,957.74 points in late morning deals. Frankfurt\'s DAX 30 shed 0.75 percent to 7,436.33 points and in Paris the CAC 40 index lost 0.88 percent to 4,022.40.
The Stoxx 50 index of leading eurozone companies slid 1.19 percent to 2,917.72 points.
Shares in HSBC fell 1.60 percent to 641.3 pence after Europe\'s biggest bank unveiled mixed earnings. Britain\'s Asia-focused lender said on Monday that net profits surged 58 percent to more than $4.15 billion (2.88 billion euros) in the first quarter on lower taxes and bad debt charges.

However it added that the group\'s pre-tax gains were pushed down by rises in other exceptional costs, including money set aside to compensate customers in Britain who were mis-sold payment protection insurance.
Another of Britain\'s major banks, Barclays, saw its share price fall 1.31 percent to 273.95 pence after announcing plans to set aside £1.0 billion (1.14 billion euros, $1.64 billion) to compensate clients who were mis-sold payment protection insurance (PPI).
British banks had in April lost a high court appeal against tighter regulation of PPI, which can cover repayments on credit products for consumers who for example lose their jobs.
In Frankfurt trade meanwhile, Munich Re shed 1.56 percent to 110.30 euros after the world\'s biggest reinsurance company unveiled a sharp first quarter loss on major disasters in the Asia Pacific region. It added that the group should still make an annual profit.

Munich Re suffered a net loss of 948 million euros ($1.37 billion) in the three months from January to the end of March, compared with a profit of 485 billion euros in the same period a year earlier, a statement said.
Analysts polled by Dow Jones Newswires had forecast an even bigger loss of about 1.1 billion euros.
Japanese shares closed down 0.66 percent on Monday over concerns about potential power shortages following a government call to shut down the Hamaoka nuclear plant southwest of Tokyo, brokers said.
US stocks closed solidly higher on Friday, propelled by data showing strong jobs creation in the world\'s biggest economy.