The possibility of a $14 billion fine for Deutsche Bank and a slide in oil prices hit financials and energy stocks yesterday, leading most global stock indexes lower.

US data showing a strong increase in August consumer prices bolstered those arguing for the Federal Reserve to raise interest rates later this year, helping send US Treasury yields and the dollar higher.

Meanwhile stocks fell as investors dumped shares of banks in North America and Europe after the US Department of Justice proposed Deutsche Bank  pay $14billion to settle an investigation of its selling of mortgage-backed securities.

Deutsche Bank, whose shares dropped roughly 8.5 per cent, said it would fightthe demand.

MSCI’s world stocks index  was down 0.66 per cent, on pace for a second straight weekly loss.

Energy stock prices were cut by a drop in oil futures asrising Iranian exports and returning supplies from Libya and Nigeria fueled concerns a global glut would persist.

Brent crude was down 1.7 per cent at $45.81 a barrel, while US crude was down 1.91 per cent at $43.07.

“When oil goes down, investors get nervous about the risk of default in theenergy patch,” said Thomas Wilson, senior investment manager at Brinker Capitalin Philadelphia.

The Dow Jones industrial average  fell 86.66 points, or 0.48 percent, to 18,125.82, the S&P 500  lost 9.84 points, or 0.46 per cent, to 2,137.42 and the Nasdaq Composite dropped 12.48 points, or 0.24 per cent, to 5,237.21.

The S&P energy index  was down 0.82 per cent while the S&P financials index  was down 0.87 per cent.

European shares posted their worst weekly performance in three months. Europe’s broad FTSEurofirst 300 index  closed down 0.79 per cent on the day.

US Treasury yields, meanwhile, fell even as data showed US consumer prices increased more than expected in August, pointing to a steady build-up of inflation.

Benchmark 10-year notes  were last up 1/32 in price to yield 1.7013 per cent.

The so-called core CPI, which strips out food and energy costs, increased 2.3per cent in the 12 months through August, above the Fed’s target of two per cent annual inflation.

Meanwhile the uptick in inflation is likely to be welcomed by a number of Fed officials when they meet next Tuesday and Wednesday to deliberate on monetary policy.