adminLondon’s benchmark FTSE 100 index dropped 1,0 percent to 5 468,22 points, Frankfurt’s DAX 30 shed 1,80 percent to 6 116,43 points and in Paris the CAC 40 tumbled 1,20 percent to 3 026,44.
Madrid’s IBEX 35 slipped 0,70 percent to 6 619,00 points.
In foreign exchange deals, the euro retreated to US$1,2431 from US$1,2467 late on Thursday in New York.
“European politicians have done a fantastic job of lowering expectations for the EU summit that began yesterday, which means that even the smallest ‘breakthrough’ may cause a short-term relief rally” across financial markets, said Kathleen Brooks, research director at Forex.com trading group.
EU leaders debate a so-called “a big leap forward” for increased integration and save the euro at a two-day summit in Brussels, but splits might scuttle efforts to ring fence the single currency.
European Union heads of state and government gather from 3:00 pm (1300 GMT) as the debt crisis, now in its third year, widened this week.
Cyprus and Spain have joined the earlier victims of contagion — Greece, Portugal and Ireland — in requesting aid.
With Italy, the eurozone’s third economy, also threatened, the EU is under pressure from world leaders to deliver a convincing plan to prevent a collapse of the single currency, which would have unfathomable global repercussions.
Asian stock markets mostly closed higher on a positive lead from Wall Street but gains were capped by low expectations of a breakthrough at the EU summit.
Data in the United States boosted markets, with a positive report on pending home sales for May, as well as a solid increase in durable goods orders.
But official data released on Thursday showed unemployment in Germany edged up in June as uncertainty from the eurozone debt crisis hits the labour market.
The number of job seekers in Europe’s top economy rose by 7 000 in June from the level in May, according to seasonally-adjusted figures published by the
Federal Labour Agency in Nuremberg.
German Chancellor Angela Merkel flew to Paris late on Wednesday for talks with French President Francois Hollande in an 11th-hour bid to bridge the gap between Europe’s two biggest economies over how to solve the crisis.
She warned lawmakers in Berlin that there were “no quick, no easy” solutions, and no “magic formula” to end the problems in the 17-nation currency bloc.
“Financial markets are hoping that EU leaders will be able to come to some form of agreement about steps towards some form of banking union and a deposit
guarantee scheme, as well as agree to measures to help lower borrowing costs in Spain and Italy,” said Michael Hewson, senior analyst at CMC Markets trading group.
“Expectations are low so the potential for a positive surprise is there; unfortunately it seems more likely that nothing tangible is likely to be agreed given that EU officials are already playing down expectations.” — AFP.
Online Reporter