Investing.com - European stock markets turned sharply lower on Wednesday, as growing concerns over the current political turmoil in Greece and the country’s potential exit from the euro zone dominated market sentiment.
During European afternoon trade, the EURO STOXX 50 dropped 0.65%, France’s CAC 40 tumbled 0.74%, while Germany’s DAX 30 fell 0.07%.
Market sentiment came under strong pressure after Alexis Tsipras, the head of Greece’s second-biggest party Syriza, said on Tuesday that Greece's financial aid package is null and void, and called for a moratorium on Greek debt payments.
Tsipras was to hold talks with Greece’s leading political parties later in the day, as attempts to form a government continue, but if talks fail a second round of elections will have to be held.
Investors were also fearful that French president-elect Francois Hollande’s focus on growth rather than austerity measures as a means to tackle the euro zone’s debt crisis could spark tensions with Germany.
Spanish lenders BBVA and Banco Santander led losses in the financial sector, diving 4.92% and 4.57% respectively, while Bankia rose 0.49% although JP Morgan earlier downgraded the bank to underweight, the equivalent of a sell recommendation.
France’s BNP Paribas and Societe General were also sharply lower, tumbling 2.60% and 3.01% respectively, while German lender Deutsche Bank retreated 1.53%.
Meanwhile, Mediaset plunged 11.54% after the Italian broadcaster reported an 85% slump in first-quarter net income to EUR10.3 million due to lower advertising sales.
On the upside, Carlsberg AG jumped 3.47% after the world’s fourth-biggest brewer reported a 43% drop in first-quarter operating profit as it sold less beer in Russia.
In London, FTSE 100 plummeted 1%, after industry data showed that retail sales in the U.K. fell 3.3% in April after a 1.3% rise the previous month.
U.K. lenders tracked their European counterparts lower, as shares in the Royal Bank of Scotland plunged 3.96% and Lloyds Banking tumbled 3.40%, while Barclays and HSBC Holdings declined 1.18% and 0.01%.
Mining giants Rio Tinto and Bhp Billiton extended earlier losses, with shares falling 0.78% and 1.28%, while copper producer Xstrata jumped 1.10%.
Elsewhere, Itv held gains, surging 3.16%, after the broadcaster said TV ad revenues could be up by as much as 17% in June, thanks to an advertising surge from campaigns around the Queen's diamond jubilee and the Euro 2012 football tournament.
In the U.S., equity markets pointed to a lower open. The Dow Jones Industrial Average futures pointed to fall of 0.51%, S&P 500 futures signaled a 0.66% decline, while the Nasdaq 100 futures indicated a 0.65% loss.
Also Wednesday, official data showed that German exports and imports both hit record highs in March, fuelling hopes that the euro zone’s largest economy is weathering the effects of the debt crisis.
The Federal Statistics Office said exports increased by 0.9% to EUR91.8 billion, while imports rose 1.2% to EUR78.1 billion.
Later in the day, the U.S. was to produce government data on crude oil stockpiles. A 10-year U.S. government bond auction was also scheduled.
During European afternoon trade, the EURO STOXX 50 dropped 0.65%, France’s CAC 40 tumbled 0.74%, while Germany’s DAX 30 fell 0.07%.
Market sentiment came under strong pressure after Alexis Tsipras, the head of Greece’s second-biggest party Syriza, said on Tuesday that Greece's financial aid package is null and void, and called for a moratorium on Greek debt payments.
Tsipras was to hold talks with Greece’s leading political parties later in the day, as attempts to form a government continue, but if talks fail a second round of elections will have to be held.
Investors were also fearful that French president-elect Francois Hollande’s focus on growth rather than austerity measures as a means to tackle the euro zone’s debt crisis could spark tensions with Germany.
Spanish lenders BBVA and Banco Santander led losses in the financial sector, diving 4.92% and 4.57% respectively, while Bankia rose 0.49% although JP Morgan earlier downgraded the bank to underweight, the equivalent of a sell recommendation.
France’s BNP Paribas and Societe General were also sharply lower, tumbling 2.60% and 3.01% respectively, while German lender Deutsche Bank retreated 1.53%.
Meanwhile, Mediaset plunged 11.54% after the Italian broadcaster reported an 85% slump in first-quarter net income to EUR10.3 million due to lower advertising sales.
On the upside, Carlsberg AG jumped 3.47% after the world’s fourth-biggest brewer reported a 43% drop in first-quarter operating profit as it sold less beer in Russia.
In London, FTSE 100 plummeted 1%, after industry data showed that retail sales in the U.K. fell 3.3% in April after a 1.3% rise the previous month.
U.K. lenders tracked their European counterparts lower, as shares in the Royal Bank of Scotland plunged 3.96% and Lloyds Banking tumbled 3.40%, while Barclays and HSBC Holdings declined 1.18% and 0.01%.
Mining giants Rio Tinto and Bhp Billiton extended earlier losses, with shares falling 0.78% and 1.28%, while copper producer Xstrata jumped 1.10%.
Elsewhere, Itv held gains, surging 3.16%, after the broadcaster said TV ad revenues could be up by as much as 17% in June, thanks to an advertising surge from campaigns around the Queen's diamond jubilee and the Euro 2012 football tournament.
In the U.S., equity markets pointed to a lower open. The Dow Jones Industrial Average futures pointed to fall of 0.51%, S&P 500 futures signaled a 0.66% decline, while the Nasdaq 100 futures indicated a 0.65% loss.
Also Wednesday, official data showed that German exports and imports both hit record highs in March, fuelling hopes that the euro zone’s largest economy is weathering the effects of the debt crisis.
The Federal Statistics Office said exports increased by 0.9% to EUR91.8 billion, while imports rose 1.2% to EUR78.1 billion.
Later in the day, the U.S. was to produce government data on crude oil stockpiles. A 10-year U.S. government bond auction was also scheduled.