European stocks slide as Greece fails to elect leader

GMT 15:10 2014 Monday ,29 December

Arab Today, arab today European stocks slide as Greece fails to elect leader

Greece's parliament
London - AFP

European stock markets mainly slumped on Monday following the holiday break, as attention focused on Greece's failure to elect a president, triggering sharp losses for share prices in Athens.
In early afternoon deals, Frankfurt's DAX 30 lost 0.53 percent to 9,869.44 points and the CAC 40 in Paris dipped 0.07 percent to 4,293.05 compared with last Wednesday's closing level.
Spain's IBEX 35 shed 1.43, Milan's MIB slid 1.96 percent and in Athens the main index plunged to a loss of 8.45 percent in afternoon deals.
London's benchmark FTSE 100 index added 0.25 percent to stand at 6,626.43 points approaching midday in the British capital.
Before the pause in trading, European stock markets had diverged in Christmas Eve trade after a global rally that was sparked by stellar economic growth figures from the United States.
Trading will be curtailed again this week owing to New Year celebrations.
"While it is a short trading week for markets across the globe, there is still enough activity to keep traders busy," Stan Shamu, market strategist at IG trading group said on Monday.
"The Greece situation is likely to dictate how risk trades for the rest of the week," he added.
In foreign exchange Monday, the euro climbed to $1.2203 compared with $1.2179 late in New York on Friday.
- Greek vote -
Greece's parliament on Monday failed for a third time to elect a president, forcing early elections in the coming weeks that could see a radical left party win power.
Greek stocks plunged as much as 11 percent after the vote, with fears that the anti-austerity Syriza party could undo many of Greece's economic reforms if it wins the election.
Greek borrowing rates also soared, with its 10-year yield climbing to 9.55 percent from 8.50 percent on Wednesday, though trading volume was low.
In recent days, European Commission President Jean-Claude Juncker and German Finance Minister Wolfgang Schaeuble have warned the Greeks not to change course and abandon the reforms.
The European Union and the International Monetary Fund have overseen two massive international bailouts for Greece.
Elsewhere on Monday, Russia's government revealed that its country's economy shrank in November for the first time in five years, as sliding oil prices and Western sanctions over Ukraine take their toll.
The economy ministry said gross domestic product for the month contracted by 0.5 percent year-on-year for the first time since October 2009.
The ruble fluctuated wildly earlier this month, with the central bank raising interest rates to 17 percent from 10.5 percent to prop up the currency and Russians snapping up imported goods ahead of expected price hikes.
Oil prices rose on Monday, supported by violence in crude producer Libya.
West Texas Intermediate for February delivery climbed 45 cents to $55.18 a barrel, while Brent North Sea crude for February gained 48 cents to $59.93.
Daniel Ang, investment analyst at Phillip Futures in Singapore, said investors are showing concern as the "armed conflict in Libya is affecting crude oil flows".
Forces loyal to Libya's internationally recognised government on Sunday carried out air strikes against Islamist militia following attacks on the country's crucial Al-Sidra oil export terminal.
Despite Monday's support, oil prices have shed about half of their value since June owing to a production glut, weak global demand and a stronger US dollar, according to analysts.


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