Investing.com - European shares closed lower across the board on Wednesday as the Federal Reserve said no to further economic stimulus in the world's largest economy.
After the close of European trade, the EURO STOXX 50 was lower by 2.44%, France's CAC 40 plunged 3.33%, while Germany's DAX 30 spiraled lower by 1.72%. Meanwhile, in the U.K. the FTSE 100 dropped 2.25%.
The Fed said no to lower borrowing costs and instituting a new quantitative easing package in a statement yesterday.
This lack of U.S. support triggered the day long selling in the euro zone stock markets. However, the U.S. will continue its "Operation Twist" which exchanges USD400 billion of short term debt for long term securities in an effort to lengthen the average maturity of its holdings.
The IFO institute cut its 2012 German economic growth forecast to 0.4% from 2.3% adding to the bearish sentiment of the session.
Another negative report, from Eurostat, indicated that euro zone industrial production dropped 0.1%. Economists were predicting no change.
Logica led the decline plunging 16% after lowering its revenue growth forecast and ramping up a restructuring that will result in USD124 million in charges.
Financial companies were hit hard in the sell off, with BNP Paribas giving back 7.4% and Societe Generale falling 8%.
Citibank analyst, Ronit Ghose added to the fear by advising Bloomberg, "European lenders may drop another 30% as the euro as the euro area has begun to deleverage."
Spanish clothing retailer Inditex bucked the downtrend by advancing 1.7% on 6.2% greater profit and Asian expansion.
U.S. stocks followed Europe lower in midday trading with the Dow Jones Industrial Average falling 0.95%, the S&P 500 giving back 1.19% and the Nasdaq 100 dropping 1.65%.
Investors are awaiting European Central Bank head Mario Draghi to speak on Thursday, as well as the ECB's monthly bulletin.
After the close of European trade, the EURO STOXX 50 was lower by 2.44%, France's CAC 40 plunged 3.33%, while Germany's DAX 30 spiraled lower by 1.72%. Meanwhile, in the U.K. the FTSE 100 dropped 2.25%.
The Fed said no to lower borrowing costs and instituting a new quantitative easing package in a statement yesterday.
This lack of U.S. support triggered the day long selling in the euro zone stock markets. However, the U.S. will continue its "Operation Twist" which exchanges USD400 billion of short term debt for long term securities in an effort to lengthen the average maturity of its holdings.
The IFO institute cut its 2012 German economic growth forecast to 0.4% from 2.3% adding to the bearish sentiment of the session.
Another negative report, from Eurostat, indicated that euro zone industrial production dropped 0.1%. Economists were predicting no change.
Logica led the decline plunging 16% after lowering its revenue growth forecast and ramping up a restructuring that will result in USD124 million in charges.
Financial companies were hit hard in the sell off, with BNP Paribas giving back 7.4% and Societe Generale falling 8%.
Citibank analyst, Ronit Ghose added to the fear by advising Bloomberg, "European lenders may drop another 30% as the euro as the euro area has begun to deleverage."
Spanish clothing retailer Inditex bucked the downtrend by advancing 1.7% on 6.2% greater profit and Asian expansion.
U.S. stocks followed Europe lower in midday trading with the Dow Jones Industrial Average falling 0.95%, the S&P 500 giving back 1.19% and the Nasdaq 100 dropping 1.65%.
Investors are awaiting European Central Bank head Mario Draghi to speak on Thursday, as well as the ECB's monthly bulletin.