Rabu, 09 Mei 2012

Europe rattles, and Euro Stocks fall

European stock markets fell on Tuesday and the euro also fell against the dollar, because the sentiment is dominated by uncertainty in the euro zone after weekend elections in France and Greece.

In London, the FTSE 100 index ended the day with a loss of 1.78 percent at 5554.55 points, the first day of trading after the close on Monday.

In Paris the CAC 40 index fell by 2.78 percent to 3124.80 points while in Frankfurt the DAX 30 slid 1.90 percent to 6444.74 points.

Investors spent the day taking into account the prospect of soaring tensions euro zone because of the Greek political parties difficult to establish a workable ruling coalition and the EU special summit scheduled for May 23.

Greek stocks gave up 3.62 percent after falling 6.67 percent on Monday, and now find themselves at a level last seen about 20 years ago.

In foreign exchange transactions, the euro fell to 1.3005 dollars from 1.3052 dollars in New York late on Monday.

Stock trading in New York are also burdened by the strain euro zone, and at 14:30 GMT, the Dow Jones Industrial Average was down 0.92 percent at 12888.34 points. S & P 500 had dropped 1.03 percent to 1355.45, while the Nasdaq fell 1.26 percent at 2920.36 points.

Pessimism generated by a Greek who reject ballot savings approved by the parties to negotiate a second rescue package from the European Union and International Monetary Fund (IMF) undermine market sentiment. Greece may have to return to the polls if no coalition is formed.

And economist Ben May at Capital Economics said: "There is a clear risk that new elections might not bring a decisive outcome, prompting Greece to withdraw from the agreement and the default bail-out" on his country's debt.

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