US markets end lower led by decline in banking stocks

The US markets slumped in the final hour of trading to finish sharply lower in thin trading led by decline in banking stocks following a report from Fitch on US bank exposure to Europe.

Dow Jones Industrial Average was down 1.58% or 190.57 points at 11905.59. Nasdaq Composite shed 1.73% or 46.59 points at 2639.61. Standard & Poor's 500 fell 1.665 or 20.9 points at 1236.91.

Fitch came out with a report on US bank exposure to Europe, while it describes current exposure as "manageable," they also noted that "unless the euro zone debt crisis is resolved in a timely and orderly manner, the broad credit outlook for the US banking industry could worsen.

Fitch warned that risks of a negative shock are rising and could alter its current stable outlook. Bank of America and JP Morgan chase each closed about 4% lower.

Economic data did little to alter investor sentiment in US, the October consumer price index slipped by 0.1%, which is not too different than the consensus call for no change. Core prices made a 0.1% increase, which was also on expected lines.

Industrial production meanwhile increased by 0.7% in October. That exceeded the 0.4% increase that had been broadly expected.

It's a busy Thursday in terms of data expected from US, the weekly initial jobless claims are seen slightly higher at 395000 compared to 390,000 the previous week.

The housing starts for October are expected to be lower after the sharp 15% jump seen in September. It's expected around 0.606 units as compared to 0.658 million units in the previous month.

Onto other asset classes, the euro traded near the flat line as rising French and Italian borrowing costs heightened worries about contagion in the euro zone debt crisis. The European Central Bank