Markets nervous as euro ministers meet on Greece

Concerns over latest meeting on Greece weighs on markets at start of trading week

Associated Press
Asia stocks up after deal over Greek debt reached
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People stand in the rain in front of the electronic stock board of a securities firm in Tokyo, Monday, Nov. 26, 2012. Asian stock markets posted slight gains Monday after the unofficial start of the holiday shopping season in the U.S. topped expectations, offsetting concerns about Greece's financial crisis. (AP Photo/Koji Sasahara)

LONDON (AP) -- Concerns that European finance ministers will again fail to reach an agreement on handing over more bailout cash to Greece weighed on markets Monday.

Following last week's bout of optimism, which sent a number of stock indexes up to near 2012 highs and the euro back towards $1.30, some investors were expected to cash in on the gains.

Doubts that European ministers will fail again to agree on a deal for Greece encouraged investors to sell, as did election results in the Spanish region of Catalonia that saw separatists gain ground.

In Europe, Britain's FTSE 100 stock index fell 0.6 percent to close at 5,786.72 while Germany's DAX fell 0.2 percent to 7,292.03. The CAC-40 in France dropped 0.8 percent to 3,500.94.

The euro meanwhile could not add to recent gains and was trading 0.1 percent lower at $1.2962.

In Brussels, the 17 eurozone finance ministers were meeting for the third time in as many weeks to try to agree a strategy that will allow them to release some €44 billion ($56.8 billion) for the cash-strapped country.

The expectation is that Greece will get the money and an extra two years to make the reforms that are a condition of the bailout. But an extension would cost the eurozone several billion more and finding that money has proved difficult.

Several proposals to plug the financial gap have been proposed, including reducing the interest rate Greece pays on loans it is getting from euro partners and the International Monetary Fund. Time is short, as Greece is running out of the money it needs to pay its day-to-day running costs.

"Clearly any decision by the eurogroup to kick the Greek issue further down the road will stand to unsettle markets globally," said Fawad Razaqzada, market strategist at GFT Markets.

In the U.S., the Dow Jones industrial average was down 0.7 percent at 12,920.70 while the broader S&P 500 index fell 0.6 percent to 1,400.64.

The falls on Wall Street come despite signs that the crucial holiday shopping season has enjoyed a solid start. Surveys showed that Americans visited stores and websites in record numbers last Friday, the day after the Thanksgiving holiday.

Earlier, Asian markets failed to make much headway. While Japan's Nikkei 225 index rose 0.2 percent to 9,388.94, Hong Kong's Hang Seng was sapped of momentum by lethargic mainland Chinese markets, closing 0.3 percent lower at 21,857.77.

In China, the Shanghai Composite Index was down 0.5 percent to 2,017.46 while the smaller Shenzhen Composite Index lost 1.4 percent to 789.49.

Oil prices tracked equities lower, with the benchmark New York rate down 79 cents at $87.49 per barrel in electronic trading

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