European stock markets slide amid Greece pressure

PanARMENIAN.Net - European stock markets slid and the euro steadied Tuesday, January 24, after eurozone finance ministers heaped pressure on Greece to prevent a debt default and following a positive bond auction for Spain, according to AFP.

Shares in French banks retreated sharply, with Societe Generale losing more than 5.0 percent, after Standard and Poor's downgraded most following its downgrade of France's sovereign rating.

"Markets are suffering from a little bit of profit-taking after yesterday's strength as we see the same old situation," said Simon Denham, head of Capital Spreads trading group. "We've seen it all before where negotiations in Europe run on longer than expected as bondholders and ministers can't agree on a deal to reduce Greece's debts."

Banks involved in restructuring Greece's debt said Monday they had made their best offer and that it was now up to bailout providers to seal a deal.

On Tuesday, eurozone finance ministers pressed Greece to prepare new budget cuts soon and conclude negotiations with bank creditors on a massive debt writedown within days to avoid a messy default. European economic affairs commissioner Olli Rehn urged Greece to accelerate economic reforms in order to spur growth, after talks between finance ministers that began Monday afternoon and ended past midnight.

Also attracting market attention was news that Spain's borrowing rates tumbled Tuesday as the indebted eurozone member raised 2.507 billion euros ($3.3 billion) in an auction of three- and six-month bills. Investors put in bids for 13.6 billion euros of bills, outstripping supply more than five times and allowing the Treasury easily to meet its goal of raising 1.5-2.5 billion euros, Bank of Spain figures showed.