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European market hit by concerns over sluggish world economy

08-04-2011 08:52 BJT

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Reaching a deal on the debt limit has provided little relief to investors in the US and Asia, and in Europe, it's not giving much comfort either.

Major European markets opened lower, on concerns over sluggish global economic growth, and a revival of its own debt crisis. German stocks are in free fall, with the benchmark DAX Index dropping 10 percent from this year's high.

Analysts say investors are worried the US economy is faltering, and the nation could lose its top notch credit rating. Meanwhile, Spain's premium risk reached a new historic record, adding weight to already heavy markets.

Fidel Helmer, analyst in Hauck & Aufhaeuser said, "The raising of the debt limit is one thing but the other thing is that the U.S. will still be in debt and that will not solve the problem of the U.S. debt at all. And the rating agencies don't like that, the U.S. is still AAA but the prospect is negative. And that stresses the markets."

Editor:Li Wanran |Source: CNTV.CN

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