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European Shares Set to Open Lower on Korea Fears

Reuters and CNBC.com
Monday, 20 Dec 2010 | 2:05 AM ET

European shares were set to dip on Monday, with investors' nerves rattled by possible escalating tensions in North Korea, though trading volumes were expected to be thin as the year-end holiday season looms.

An Indian stock broker looks worried as he watches the screen in Mumbai, India.
Sajjad Hussain | Getty Images
An Indian stock broker looks worried as he watches the screen in Mumbai, India.

European Union leaders on Friday agreed to make moderate amendments to the EU treaty in order to create a permamnent bailout mechanism, but left questions surrounding the details of such a mechanism unanswered.

"It is like changing the constitution..it gives very strong mandate for a strong support mechanism that will stabilize euro whenever neccessary," Greek Prime Minister George Papandreou told CNBC at the gathering of EU leaders.

European shares fell on Friday, with banks lower after Moody's slashed Ireland's credit rating, sparking further worries about the euro zone peripheral countries' debt crisis.

Rating agency Moody's on Friday downgraded Ireland's credit rating by five notches and warned further downgrades could follow if Ireland was unable to stabilize its debt situation.

But as the European debt crisis continued to cause market unrest, German Chancellor Angela Merkel said Europe would do everything it could to secure the stability of the euro.

Economic data due on Monday includes UK consumer confidence for December and UK mortgage lending figures.

Also on the agenda are German producer prices for November and the German central bank's monthly bulletin.

Capital Shopping Centres holds a shareholder meeting on Monday to vote on the proposed acquisition of the Trafford shopping centre in Manchester from the Peel Group.

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