European stocks fall 1.2%, investor dumps German banks

European stock markets fell on Tuesday as traders watched a wave of selling in the banking sector and looked ahead to crucial central bank meetings and inflation data from the United States.

In early trading, the Euro Stoxx 600 index fell 1.2 percent, with the German DAX plunging 1.8 percent and the banking sector tumbling 2.3 percent. According to reports released on Monday, an unnamed investor sold huge holdings in Germany’s two largest banks, Deutsche Bank and Commerzbank.

Deutsche Bank’s stock was down 9.5 percent, while Commerzbank’s stock was down 8.6 percent. In a statement, the former stated it was “confident in our strategy.” According to sources, the sale includes 116 million Deutsche Bank shares and 72.5 million Commerzbank shares, totalling more than 5% of the two German banks.

Nigel Bolton, a co-chief investment officer of BlackRock Fundamental Equities, said traders should keep a watch on major investor movements rather than individual stock news.

“When you look at the equity markets at the moment I do think there are some attractive areas, actually European banks are looking incredibly cheap now,” he told CNBC.