A German bund auction failed to reach its target. This sent stocks in Europe down as German officials explained that the failure was due to “technical” problems. The German government attempted to sell €6 billion in 10-year notes, but the bids totaled just €3.9 billion.
Analysts believe the failure was related to the fear surrounding European debt in general. Italian, Spanish, and Greek uncertainties didn’t help the Germans.
This drove the DAX (Germany) down 79 points (1.44%) to 5,457.77. Stocks in England suffered as well; the FTSE 100 fell 67.04 points (-1.29%) to 5,139.78.
An ominous statement from the Bank of Greece didn’t instill any confidence. The bank called the October agreement with the EU their “last” opportunity to reshape their economy.
“The country must avoid any further delays or deviations from targets at all costs; indeed, every possible effort needs to focus on overshooting the targets,” the bank said.
Traders worry that Greece will be forced to leave the EU17, and the common European currency. “What is at stake is whether the country is to remain within the euro area in the future,” the BOG said. “Every possible effort needs to focus on overshooting the targets.”
Investor confidence in the United States didn’t improve. The DJIA fell 236.17 (-2.05%) to 11,257.55. All nine sectors declined. The basic materials sector was lower than the others, down more than three percent.
By: Tim Edwards