European stocks drop after IMF halts Greek talks

GMT 13:40 2015 Friday ,12 June

Arab Today, arab today European stocks drop after IMF halts Greek talks

Europe's main stock markets
London - AFP

Europe's main stock markets fell on Friday, the day after the International Monetary Fund pulled its team out of Greece's bailout reform talks saying they were far off reaching a deal.

In late morning deals, London's benchmark FTSE 100 index of top companies shed 0.49 percent to 6,813.3 points and the CAC 40 in Paris lost 0.55 percent to 4,944.10.

Frankfurt's DAX 30 index reversed 0.46 percent to 11,281 points compared with Thursday's closing level.

Athens' main index was down 2.85 percent to 799.67 points.

In foreign exchange activity, the euro fell to $1.1168 from $1.1260 late on Thursday in New York, pressured by Greek concerns

"European equities are trading moderately lower... after yesterday’s rally had come to an abrupt halt on the back of reports that the IMF has halted negotiations with Greece due to a lack of progress," said analyst Markus Huber at brokerage Peregrine & Black.

"However the fallout ... has been limited by the release of solid US economic data pointing towards a strong rebound in economic growth."

- 'Unimaginable' without IMF -

The IMF on Thursday withdrew from eleventh-hour talks in Brussels, saying an agreement remained far-off after a five-month stalemate with Greece's anti-austerity government, which faces being unable to pay huge debts at the end of the month.
However, Eurogroup chief Jeroen Dijsselbloem insisted on Friday that a bailout deal for cash-strapped Greece without the IMF's involvement would be "unimaginable".

Without the IMF, a deal is "unimaginable because it needs to have proper content and if it has proper content, the IMF will also participate," Dijsselbloem told journalists in The Hague.

- Creditors 'far from convinced' -

Greece must reach a compromise with its creditors -- the IMF, European Commission and European Central Bank -- before the end of the month to unlock much-needed cash to service its debts. Failure to do so will lead it to default and possibly exit the eurozone.

"While the rhetoric coming from the Greek camp is one of optimism and confidence at a deal being reached, its creditors are far from convinced," said analyst Craig Erlam at trading firm Oanda.

"The IMF pulled out of talks in Brussels on Thursday and decided to return to Washington as progress was not being made on key areas such as pension and labour market reform."
Wall Street shares jumped for a second consecutive day Thursday after the US Commerce Department said retail sales in May rose 1.2 percent, better than the 1.1 percent gain forecast by analysts.

The figures are the latest in a string of data showing the world's number one economy is back on the road to recovery after a wobbly few months at the start of the year caused by a severe winter.

The Dow gained 0.22 percent, the S&P 500 added 0.17 percent and the Nasdaq rose 0.11 percent.

Asian equities were boosted by the positive showing in New York.

Hong Kong rose 1.39 percent, Shanghai added 0.87 percent and Tokyo climbed 0.12 percent in value.


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