European stocks close

European stocks declined from a five-year high as investors sold holdings in companies from Lloyds Banking Group Plc to Continental AG.

In Germany, a report showed that investor confidence in Europe’s largest economy increased in September to the highest level since April 2010. An index compiled by the ZEW Center for European Economic Research, which aims to predict economic developments six months in advance, rose to 49.6 from 42 in August. That exceeded the median economist projection for a reading of 45.

National benchmark indexes dropped in 14 of the 18 western-European markets today. Germany’s DAX and France’s CAC 40 fell 0.2 percent. The U.K.’s FTSE 100 declined 0.8 percent.

Lloyds retreated 3.5 percent to 74.7 pence after UK Financial Investments Ltd. sold a 6 percent stake in Britain’s largest mortgage lender. The body, which oversees the government’s holdings in banks, said it sold 4.28 billion shares at 75 pence apiece. The transaction reduced the government’s stake in Lloyds to 32.7 percent from 38.7 percent.

Continental fell 3.1 percent to 123 euros after Schaeffler AG and Schaeffler Verwaltungs GmbH sold a combined stake of 4 percent in Europe’s second-largest maker of auto parts. Schaeffler and its holding company sold 7.8 million shares at 122.50 euros a share, according to a statement.

A gauge of carmakers slipped 1.4 percent from its highest level in at least 26 years after a report showed European car sales fell 4.9 percent in August. Volkswagen AG lost 1.5 percent to 180.25 euros. PSA Peugeot Citroen and Renault SA, France’s biggest automobile manufacturers, dropped 2.5 percent to 12.32 euros and 2.4 percent to 58.15 euros, respectively.