STOXX 600 slump 1, near 7mth low
Automakers, banks lead declines
ECB expected to hold rates at 1215 GMT
StanChart, Mercedes Benz drop on downbeat earnings
BE Semiconductor tops STOXX 600 on upbeat gross margin

Oct 26 Reuters European shares dropped on Thursday, hit by a rise in U.S. Treasury yields and a slew of weak earnings reports including from Standard Chartered in the run up to the European Central Bank39;s policy decision later in the day.

The panEuropean STOXX 600 index fell 1 by 830 GMT and hovered near a sevenmonth low, with automakers and banks leading declines.

The benchmark index tracked a slump on Wall Street overnight as longerdated yields edged closer to the 5 level, rekindling fears about U.S. interest rates staying higher for longer in the face of a resilient U.S. economy.

Lacklustre lending data and evidence of faltering economic growth in the euro zone has bolstered expectations that the ECB will keep its key interest rate unchanged at a record 4 high at 1215 GMT.

There is recession risk, there39;s geopolitical risk, there39;s bond risk and poor economic data from across the region, said David Morrison, senior market analyst at Trade Nation.

Bank shares were a big drag on Thursday, down 2.3 as more earnings reports from the sector trickled in.

Standard Chartered shares slumped 11.3 and were set for their worst day in over three years as the lender39;s thirdquarter pretax profit dropped 33 while BNP Paribas fell 4.1 on reporting a fall in…