Investors on both sides of the Atlantic turned a wary eye to Brussels today, where euro zone leaders gathered at an informal meeting to assess the state of the currency bloc and the political landscape after elections in France and Greece.
There are, once again, real fears that Greece could drop the euro and destabilize the currency, which sunk below $1.26, a two-year low. There have also been calls from the new French president, François Hollande, to establish a bond backed by all of the member states, putting him at odds with Angela Merkel, the powerful German chancellor.
The FTSE MIB in Milan led a stock selloff, tumbling 3.7 percent to 12,960.87. The index is trading at levels that prior to the last week or so hadn’t been seen since March 2009.
Paris’ CAC 40 sank 2.6 percent to 3,003.27, as London’s FTSE 100 fell 2.5 percent to 5,266.41 and Frankfurt’s DAX declined 2.3 percent to 6,285.75.
The decliners included Geox, down 4.1 percent to 1.49 euros; Yoox, 3.3 percent to 11.09 euros; LVMH Moët Hennessy Louis Vuitton, 3.3 percent to 119.45 euros, and Safilo Group, 3.4 percent to 4.50 euros.
In midday trading on Wall Street, the S&P Retail Index was down 0.3 percent, or 2.06, to 595.22, as the Dow Jones Industrial Average fell 1.1 percent, or 140.24 points, to 12,362.57.
Slipping in the market were The Bon-Ton Stores Inc., down 4.6 percent to $3.53; Avon Products Inc., 3.2 percent to $16.27; Fifth & Pacific Cos. Inc., 2.9 percent to $12.03; Ralph Lauren Corp., 2.8 percent to $146.02, and stock newcomer Tumi Holdings Inc., 2.8 percent to $19.10.
There were execeptions, however. Shares of Movado Group Inc. shot up 10.3 percent to $28.60 after the company boosted its profit guidance for 2013. And Zale Corp. stock gained 8.2 percent to $2.52 following word that strengthening fine jewelry sales helped narrow third-quarter losses.