Markets Nervous as Eurozone Finance Ministers Meet Again on Greece

Eurozone Greek Debt CrisisBy PAN PYLAS

LONDON -- Concerns that European finance ministers will again fail to reach an agreement on handing over more bailout cash to Greece weighed on markets Monday.

Most attention will focus on the finance ministers meeting in Brussels though election results in the Spanish region of Catalonia that saw separatists gain ground have also added to investor worries at the start of the week.

For weeks, the eurogroup of finance ministers have failed to agree a strategy that will allow them to release some €44 billion ($56.8 billion) for the cash-strapped country.

The expectation is that Greece will get the money and an extra two years to make the reforms that are a condition of the bailout. But an extension would cost the eurozone several billion more and finding that money has lain at the heart of the current stalemate.

Several proposals to plug the financial gap have been proposed, including reducing the interest rate Greece pays on loans it is getting from euro partners and the International Monetary Fund. Time is short as Greece is running out of the money it needs to pay its day-to-day running costs.

"Clearly any decision by the eurogroup to kick the Greek issue further down the road will stand to unsettle markets globally," said Fawad Razaqzada, market strategist at GFT Markets.

In Europe, the FTSE 100 index of leading British shares was down 0.4 percent at 5,795 while Germany's DAX fell 0.2 percent to 7,291. The CAC-40 in France was 0.6 percent lower at 3,509.

The euro meanwhile lost some of its shine but remains near multiweek highs against the dollar. Europe's single currency was down 0.1 percent at $1.2964.

Wall Street was poised for a retreat at the open too. Dow futures and the broader S&P 500 futures were 0.5 percent lower.

The expected falls in the U.S. come despite signs that the crucial holiday shopping season has got off to a solid start.

Surveys showed that Americans visited stores and websites in record numbers last Friday, the day after the Thanksgiving holiday. That day is dubbed "Black Friday" because U.S. retailers traditionally turn a profit as millions of Americans rush out to stores in search of gifts for Christmas and other celebrations.

The surveys showed a record 247 million shoppers visited stores and websites between Thursday and Sunday, up 9.2 percent from the year before.

Earlier, Asian markets failed to make much headway, if any.

While Japan's Nikkei 225 index rose 0.2 percent to 9,388.94, Hong Kong's Hang Seng was sapped of momentum by lethargic mainland Chinese markets, closing 0.3 percent lower at 21,857.77.

In China, the Shanghai Composite Index was down 0.5 percent to 2,017.46 while the smaller Shenzhen Composite Index lost 1.4 percent to 789.49.

Oil prices tracked equities lower, with the benchmark New York rate down 56 cents at $87.72 per barrel in electronic trading

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Just a thought. Lots of unemployment in Greece, wouldn't it be better to put some manufacturers there rather then try and bail them out? Let them work and pay taxes into the system?

November 26 2012 at 1:02 PM Report abuse -1 rate up rate down Reply
1 reply to electricknight's comment

Heck yes, we can close a few more down here, and send them over to Greece. We are running out of people, who want to work, anyway, and we have plenty of money to pay unemployment to our deadneats and freeloaders. Americans shouldn't have to work in factories. Send the factories on over to Greece and let those people do all the work.

November 26 2012 at 2:20 PM Report abuse rate up rate down Reply

Alert ! Many investors on Wall Street today were observed biting their fingernails.

November 26 2012 at 12:09 PM Report abuse +1 rate up rate down Reply

They will continue to pour money down a black hole as long as the Angela Merkel, German driven, austerity remains in vogue. This policy has reduced wages, employment, and tax receipts, while driving as many as 25% of people in some countries to the unemployment rolls. The result is yet more debt, and pressure from Merkel to tighten the screws with yet more austerity. This in turn further increases the debt, which leads to more austerity, and so on and so on. Merkel is an intelligent woman who has a doctorate. She seems, though, to have no common sense. In the US the crazy right wing also pushes austerity, but they don't really seem serious about it. Even in their madness they seem to understand what would happen to us if we go over the fiscal cliff and experience true austerity.

November 26 2012 at 11:22 AM Report abuse rate up rate down Reply