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Divided German coalition votes to strengthen Euro support fund

Thursday, September 29th 2011 - 06:31 UTC
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German Chancellor Angela Merkel counting to the last vote German Chancellor Angela Merkel counting to the last vote

Commodity prices fell and stocks ended a three-day rally on Wednesday on anxiety over a looming German vote to strengthen the fund set up to help the Euro zone combat its debt crisis.

Infighting in the German ruling coalition turned investors skittish, as a failed vote would hamper the bloc's ability to prevent a Greek default that could send the global financial system into turmoil.

The Dow Jones industrial average dropped 179.79 points, or 1.61 percent, to 11,010.90. The S&P 500 slid 24.32 points, or 2.07 percent, to 1,151.06. The Nasdaq Composite Index lost 55.25 points, or 2.17 percent, to 2,491.58.

European shares snapped a three-day winning streak as hopes for imminent political action to contain the region's debt crisis were capped by a lack of detail, leaving equities on course to rack up a fifth straight month of losses.

The FTSEurofirst 300 index of leading European shares was down 1.2 percent at 927.28 points, after adding 4.5 percent in the previous session. It remains down 4.1 percent in September and 17.3 percent in 2011.

Japanese shares inched up but struggled to hold gains with traders selling into strength as optimism over Europe's efforts to resolve its sovereign debt problem proved short-lived and support from dividend-related buying faded.

The Nikkei average closed up 0.1 percent at 8,615.65, with a 3.8 percent bounce in shares of telecoms firm Softbank providing the biggest boost to the index. Softbank hit a 15-month low in the previous session.
 

Categories: Politics, International.

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