Investing.com - European stock markets were sharply lower on Wednesday, as sustained concerns over political uncertainty in Greece and the effects of a potential Greek exit from the euro zone continued to dominate market sentiment.
During European morning trade, the EURO STOXX 50 dropped 0.51%, France’s CAC 40 declined 0.24%, while Germany’s DAX 30 plunged 0.75%.
Market sentiment came under pressure after Greek political leaders announced Tuesday they failed to reach an agreement to form a government, following a May 6 election which left no party with a clear majority.
Greek politicians were to meet later Wednesday to appoint a caretaker government to lead the country until fresh elections can be held in June.
But uncertainty over the outcome of the next elections fueled speculation that the country will not be able to access further financial aid and may eventually be forced to exit the euro zone.
Financial stocks led losses as shares in French lenders BNP Paribas and Societe General dove 3.06% and 2.37%, while Germany’s Deutsche Bank and Commerzbank dropped 2.54% and 2.37% respectively.
Peripheral lenders contributed to losses, with Spain’s Banco Santander plummeting 1.80% and ailing Bankia sinking 6.20%, while Italian lenders Intesa Sanpaolo and Unicredit retreated 1.69% and 1.82%.
The auto sector was also broadly lower. Shares in Volkswagen tumbled 2.38% and BMW declined 2.16%, while BMW and Italy’s Fiat dropped 2.09% and 1.72% respectively.
In London, commodity-heavy FTSE 100 tumbled 0.85%, weighed by losses in mining stocks.
Bhp Billiton lost 2.72% after the world’s largest mining company said it won’t meet its USD80 billion spending target for building mines and expanding assets over the next five years as it sees commodity prices declining.
Rio Tinto Group, the world’s third-largest, plunged 3.26%, while copper producers Xstrata and Kazakhmys plummeted 3.49% and 3.22%, tracking a dive in copper prices.
U.K. lenders were also on the downside, shadowing their European counterparts, as shares in the Royal Bank of Scotland declined 2.53% and HSBC Holdings dropped 2.15%, while Lloyds Banking and Barclays lost 2.10% and 0.21%.
In the U.S., equity markets pointed to a steady open. The Dow Jones Industrial Average futures pointed to rise of 0.06%, S&P 500 futures signaled a 0.05% gain, while the Nasdaq 100 futures indicated a 0.03% increase.
Later in the day, the euro zone was to publish official data on consumer price inflation, ahead of a speech by European Central Bank President Mario Draghi.
The U.S. was to produce official data on building permits and housing starts, followed by reports on the capacity utilization rate and industrial production. In addition, the Federal Reserve was to publish the minutes of its most recent policy meeting.
During European morning trade, the EURO STOXX 50 dropped 0.51%, France’s CAC 40 declined 0.24%, while Germany’s DAX 30 plunged 0.75%.
Market sentiment came under pressure after Greek political leaders announced Tuesday they failed to reach an agreement to form a government, following a May 6 election which left no party with a clear majority.
Greek politicians were to meet later Wednesday to appoint a caretaker government to lead the country until fresh elections can be held in June.
But uncertainty over the outcome of the next elections fueled speculation that the country will not be able to access further financial aid and may eventually be forced to exit the euro zone.
Financial stocks led losses as shares in French lenders BNP Paribas and Societe General dove 3.06% and 2.37%, while Germany’s Deutsche Bank and Commerzbank dropped 2.54% and 2.37% respectively.
Peripheral lenders contributed to losses, with Spain’s Banco Santander plummeting 1.80% and ailing Bankia sinking 6.20%, while Italian lenders Intesa Sanpaolo and Unicredit retreated 1.69% and 1.82%.
The auto sector was also broadly lower. Shares in Volkswagen tumbled 2.38% and BMW declined 2.16%, while BMW and Italy’s Fiat dropped 2.09% and 1.72% respectively.
In London, commodity-heavy FTSE 100 tumbled 0.85%, weighed by losses in mining stocks.
Bhp Billiton lost 2.72% after the world’s largest mining company said it won’t meet its USD80 billion spending target for building mines and expanding assets over the next five years as it sees commodity prices declining.
Rio Tinto Group, the world’s third-largest, plunged 3.26%, while copper producers Xstrata and Kazakhmys plummeted 3.49% and 3.22%, tracking a dive in copper prices.
U.K. lenders were also on the downside, shadowing their European counterparts, as shares in the Royal Bank of Scotland declined 2.53% and HSBC Holdings dropped 2.15%, while Lloyds Banking and Barclays lost 2.10% and 0.21%.
In the U.S., equity markets pointed to a steady open. The Dow Jones Industrial Average futures pointed to rise of 0.06%, S&P 500 futures signaled a 0.05% gain, while the Nasdaq 100 futures indicated a 0.03% increase.
Later in the day, the euro zone was to publish official data on consumer price inflation, ahead of a speech by European Central Bank President Mario Draghi.
The U.S. was to produce official data on building permits and housing starts, followed by reports on the capacity utilization rate and industrial production. In addition, the Federal Reserve was to publish the minutes of its most recent policy meeting.