Investing.com - European shares were slammed lower on Monday as the double whammy of a disappointing summit pact and a Moody's credit review notice, sent stocks spiraling down.
After the close of European trade, the EURO STOXX 50 was lower by 3.12%, France's CAC 40 dropped 2.61%, while Germany's DAX 30 was off by 3.36%. Meanwhile, in the U.K. the FTSE 100 fell 1.83%.
The European stock markets rejected the agreement made at the Summit last week. The prime concern is that the accord failed to bring decisive action by the European Central bank, widely believed to be the only way out of the dire fiscal situation.
Rating agency, Moody's added to the bearish sentiment by stating it will review the ratings of all countries in the region in the first quarter of 2012.
Insurers and financial shares led the rout lower. Allianz SE plummeted 6.5% and Italian insurance company Assicurazioni General SpA gave back 3.5%.
The largest Dutch financial services company, ING Groep plunged 7.5% after regulators demanded higher capital reserves.
Even the London Stock Exchange was not immune from the aggressive sell off. Worries that its credit rating may be slashed by S&P sent shares of the exchange operator down by 4.9%.
U.S. stocks were broadly lower across the board in midday trading with the Dow Jones Industrial Average losing 1.70%, the S&P 500 giving back 1.75% and the Nasdaq 100 falling 1.93%.
Stocks are awaiting the ZEW Centre report on German economic sentiment, U.S. Retail Sales numbers, and Fed Fund Rate on Tuesday.