Wednesday, May 23, 2012

European stock markets dow may 23 2012

European stock markets dow may 23 2012 ; European stock markets were sharply lower on Wednesday, as investor confidence weakened amid uncertainty over the outcome of a highly anticipated meeting of European leaders later in the day.

During European morning trade, the EURO STOXX 50 plunged 1.55%, France’s CAC 40 tumbled 1.33%, while Germany’s DAX 30 dropped 1.38%.

Sentiment came under pressure earlier, after former Greek Prime Minister Lucas Papademos said late Tuesday that Greece had no choice but to stick with a painful austerity program or face a damaging exit from the euro zone, a risk he said was unlikely to materialize but was real.

Meanwhile, investors eyed a key European Union summit later in the day, amid concerns over a divide between France's new President Francois Hollande, who favors measures designed to support growth and pro-austerity Germany.

President Hollande was expected to propose the introduction of joint euro bonds at the summit, but Germany has repeatedly resisted the idea, arguing they would lessen pressure for heavily indebted countries to get their finances in order.

Financial stocks were broadly lower, led by Dutch lender ING Group, down 2.32%, and closely followed by Germany’s Deutsche Bank and Commerzbank, with shares plummeting 1.99% and 1.24% respectively.

France’s biggest lenders BNP Paribas and Societe Generale were also sharply lower, as shares retreated 1.77% and 1.62%.

Meanwhile, German software company, SAP slipped 0.17% after agreeng to buy Ariba, an online trading platform for businesses, for USD4.3 billion.

On the upside, France-based Carrefour, the world’s second-largest retailer, surged 4.81% after the stock was raised to outperform, the equivalent of buy, from underperform at Credit Suisse Group AG and added to the firm’s focus list.

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