The Moving of European Stock Markets
European stock markets slumped in open on Wednesday, as Standard & Poor’s move to downgrade ratings for several global banks shadow the efforts for handling the region’s debt crisis made by European leaders on Tuesday.
London’s FTSE 100 Index down 1% at the open, Frankfurt’s DAX 0.9% and the CAC-40 Index in Paris also decline 1.3%.
On Tuesday, S&P decrease the ratings on 15 global banks as part of spread change in how the ratings company forms particularly for opinions on financial institutions. The move changes of S&P ratings will be factors to the level of governmental support, revealing an assumption that governments would keep the big banks from failing.
“Although, more than a year ago S&P began warning the markets about the revision of its ratings, the announcement appear when the markets for bank debts are weakness. This way has essentially shadowed by the progress that had been made in Brussels which relation to the useful of European Financial Stability Facility bailout fund,” said IG market.
The progress by EU leaders has helped to rise up the market confidence in recent days. On Tuesday, euro-zone finance ministers gave a good signal to their €5.8 billion share of an €8 billion tranche of bailout funding for Greece. At the same time, the International Monetary Fund is estimated will be approving €2.2 billion share on Dec. 5.
