ROME: European stocks were sharply lower on Tuesday, as the breakdown in Greek debt negotiations continued to weigh and as markets eyed the release of German economic sentiment data later in the day.
During European morning trade, the EURO STOXX 50 plummeted 1.24%, France’s CAC 40 tumbled 1.11%, while Germany’s DAX 30 lost 1.40%.
Talks between Greece and European officials ended without an agreement on a cash-for-reforms deal over the weekend, fueling fears over a debt default that would threaten Greece’s future in the euro zone.
Europe wants Greece to make spending cuts worth €2 billion in order to secure a deal that will unlock additional funds before its bailout expires at the end of June and it must repay €1.6 billion to the International Monetary Fund.
European Central Bank President Mario Draghi said Monday that a Greek default would be “uncharted waters,” but added that he believes policymakers have all the tools to manage the situation.
Investors were looking ahead to a meeting of euro zone finance ministers on Thursday, which was being seen as Greece’s last chance to strike a deal.
Financial stocks were broadly lower, as French lenders BNP Paribas (PARIS:BNPP) and Societe Generale (PARIS:SOGN) tumbled 1.35% and 1.37%, while Germany’s Commerzbank (XETRA:CBKG) and Deutsche Bank (XETRA:DBKGn) plummeted 1.53% and 1.07%.
