Stock markets across Europe tumbled today as the prospect of a Greek default — and an exit from the Euro zone — loomed larger, and reports circulated that Moody’s Investors Service was preparing to downgrade a series of French banks exposed to the troubled nation’s debt.
European markets already began the day on a down note, after finance ministers from the seven richest nations, or G-7, failed to come up with immediate measures to tackle the global economic slowdown when they met late last week.
France’s CAC 40 led the downward charge, falling 4 percent, followed by Italy’s FTSE MIB, which closed down 3.9 percent. Germany’s DAX retreated 2.3 percent, and the FTSE 100 slid 1.6 percent. U.S. markets also trended downward for most of the day, but vaulted into positive territory in a late-day rally fueled by reports that China might step in and buy Italian bonds. The S&P Retail Index rose 1.6 percent, or 8.13 points, to 503.88 and the Dow Jones Industrial Average gained 0.6 percent, or 68.99 points, to 11,061.12.
Earlier in the day, the Nikkei 225 closed down 2.3 percent in Tokyo, and the Hang Seng Index fell 4.2 percent in Hong Kong.
Most luxury and retail stocks followed the downward trend, with French companies among the day’s biggest losers. LVMH Moët Hennessy Louis Vuitton fell 3.2 percent, while Carrefour plummeted 5.8 percent; and PPR slipped 3.1 percent.
Italian stocks fared even worse, with Tod’s sliding 6.5 percent, eyewear manufacturer Safilo Group closing down 6.8 percent; and Benetton slipping 4.1 percent.