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Wall Street mixed as investors digest E.U. bailout

05-12-2010 14:58 BJT Special Report: Europe's Debt Crisis |

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Wall Street fell in a volatile session on Tuesday. Fears that the bailout plan for Europe won't solve the region's deep-seated problems blunted an improving US economic picture. And in Europe, shares slipped over similar doubts.

Gordon Brown, Former UK Prime Minister, said, "I've informed the Queen's private secretary that it is my intention to tender my resignation to the Queen ."

UK Prime Minister Gordon Brown is stepping down immediately, after failing to form a majority coalition with Liberal Democrats and losing a majority in last week's general elections. Conservative leader - David Cameron is the next Prime Minister.

Markets were hoping for a quick resolution. The British sterling held gains as currency traders bet a Conservative-led government will be tough on spending and tough on budget deficits.

That toughness may be welcomed. Investors turned doubtful on whether Greece will be able to make the tough spending cuts necessary.

Meantime, that 1,000-point plunge in the Dow last Thursday was the subject of Congressional testimony. Computer driven high-frequency trading is one thing being blamed for what is being nicknamed "The Flash Crash."

But the true causes are still a mystery, Securities and Exchange Commission Chairman Mary Schapiro told lawmakers.

Mary Schapiro, Chaiman, U.S. Securities & Exchange Commission, said, "Last Thursday's events can be likened to many dominoes falling. And while we are all understandably focused on why the first domino fell -it is equally important to understand why so many others fell as well. I believe we will eventually pinpoint the triggering events, but it is fair to say that disparate exchange rules and trading conventions caused many more dominoes to fall than should have."

To that end, Schapiro says the exchanges have agreed to adopt new market-wide circuit breakers that would halt precipitous drops in individual stocks. A source called it "a done deal."

As for Tuesday's trade - Wall Street was unable to build on the spectacular rally seen the prior session.

And in Europe - markets in France and the U.K. finished lower, but Germany squeezed out a gain.

Editor:Zhang Jingya |Source: CCTV.com

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