LONDON: European shares fell on Monday, May 23 on renewed worries about the euro zone's peripheral debt crisis, as Greece's credit ratings were cut further into "junk" territory while Italy's rating outlook was cut to negative.
Miners were among the losers as the price of copper and other metals fell on the back of strengthening dollar. Anglo American, BHP Billiton and Rio Tinto fell between 2 and 2.7 percent.
At 0710 GMT, the FTSEurofirst 300 index of top European shares was down 1 percent at 1,125.27 points, dipping below the 50-day moving average, after falling 0.4 percent in the previous week.
Standard & Poor's cut its rating outlook for Italy to negative from stable, citing weak growth prospects and increased risks it would fail to slash its debt mountain. Fitch Ratings on Friday downgraded Greece's credit rating to B-plus and put the country on rating watch negative.
"It's more than Greece now. This is more a reflection of the inability of the EU to sort out anything, and that makes people worry beyond Greece," said Lothar Mentel, chief investment officer at Octopus Investments, which manages $4 billion.
For equities to pick up, Mentel said: "The EU would need to come forward with something clever, instead of just buying time. Or we would need to see the decline in commodity prices feed through to the real economy quite quickly, and I don't expect that to happen before the end of the summer."
Low-cost airline Ryanair (RYA.I) fell 8 percent after it said high fuel cost and a lack of growth in capacity would mean flat earnings in the coming year. - Reuters
Miners were among the losers as the price of copper and other metals fell on the back of strengthening dollar. Anglo American, BHP Billiton and Rio Tinto fell between 2 and 2.7 percent.
At 0710 GMT, the FTSEurofirst 300 index of top European shares was down 1 percent at 1,125.27 points, dipping below the 50-day moving average, after falling 0.4 percent in the previous week.
Standard & Poor's cut its rating outlook for Italy to negative from stable, citing weak growth prospects and increased risks it would fail to slash its debt mountain. Fitch Ratings on Friday downgraded Greece's credit rating to B-plus and put the country on rating watch negative.
"It's more than Greece now. This is more a reflection of the inability of the EU to sort out anything, and that makes people worry beyond Greece," said Lothar Mentel, chief investment officer at Octopus Investments, which manages $4 billion.
For equities to pick up, Mentel said: "The EU would need to come forward with something clever, instead of just buying time. Or we would need to see the decline in commodity prices feed through to the real economy quite quickly, and I don't expect that to happen before the end of the summer."
Low-cost airline Ryanair (RYA.I) fell 8 percent after it said high fuel cost and a lack of growth in capacity would mean flat earnings in the coming year. - Reuters
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