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European stocks slumped as Republicans continue to press on health-care changes

europeanstockEuropean stock indexes dropped to lowest levels in almost a month as US House speaker John Boehner dismissed a possibility of clean passing the raise of federal governments debt limit.

The Stoxx Europe 600 Index slid 0.7% to 307.6 at 2:27 p.m. in London, its lowest level since Sept. 10. The equity benchmark slipped 0.7% last week as the U.S. began its first partial government shutdown in 17 years on Oct. 1.

“Everyone assumed there would be more action over U.S.- shutdown and debt-ceiling talks over the weekend, and now reality has set in,” Veronika Pechlaner, who helps oversee about $2.3 billion as an investment manager at the Jersey, Channel Islands-based Ashburton Ltd., said by phone for Bloomberg. “Investors will be nervous until some sort of compromise is reached. Any U.S. weakness is not good news for Europe.”

Boehner, who is the Republicans’ leader in the House of Representatives, continued to demand changes to President Barack Obama’s health-care act before agreeing to extend the borrowing authority. The Treasury has said it will exhaust measures to avoid exceeding the $16.7 trillion debt ceiling on Oct. 17. If that happens, the U.S. will run out of money to pay all of its bills at some point between Oct. 22 and Oct. 31, according to the Congressional Budget Office.

National benchmark indexes retreated in every western-European market except Italy and Greece. The U.K.’s FTSE 100 and France’s CAC 40 declined 0.8%, while Germany’s DAX decreased 0.9%.

In European corporate world, Marks & Spencer Group Plc retreated 3.4% to 477.2 pence after Credit Suisse Group AG estimated that the U.K. food-and-clothing retailer’s same-store sales fell 1.5% in the second quarter of its financial year. The brokerage had forecast a 0.5% increase. Marks & Spencer reports its first-half results on Nov. 5.

European Aeronautic Defence & Space Co. soared 1.9% to 50.16 euros after its Airbus SAS subsidiary won its first order from Japan Airlines Co.

EON SE and RWE AG, Germany’s biggest utilities, added 3.8% to 13.78 euros and 5.2% to 26.91 euros, respectively. The European Commission proposes to scale back a fixed-price guarantee for renewable energy, Frankfurter Allgemeine Zeitung reported. The newspaper cited an internal document from the commission.

Piraeus Bank SA jumped 3% to 1.37 euros and Alpha Bank AE gained 1.4% to 59.8 euro cents. John Paulson said in an interview with the Financial Times that his hedge fund owns stakes in the Greek lenders.

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