European stock markets drop at open after Spain downgrade
LONDON - Agence France-Presse
A screen displays the risk premiums points at Madrid's stock exchange in this file photo. AFP photo
European stock markets dropped in opening deals today after Moody's slashed Spain's credit rating by three notches, heaping more pressure on the indebted eurozone nation.
London's FTSE 100 index of leading companies fell 0.27 percent to 5,468.76 points, Frankfurt's DAX 30 dipped 0.09 percent to 6,146.92 points and in Paris the CAC 40 shed 0.23 percent to 3,022.40.
Madrid's IBEX 35 index opened 0.63 percent lower. Moody's cut Spain's rating late Wednesday and just days after the government agreed an EU deal to borrow up to 100 billion euros ($125 billion) to shore up the country's banks.
The borrowing "will materially worsen the government's debt position," Moody's said, projecting the country's public debt ratio to hit 90 percent of gross domestic product output this year and to continue rising through 2015.
Last week, Fitch also slashed Spain's rating by three notches but Standard and Poor's, while noting Madrid's difficulties, took no action, having cut its Spanish ratings by two notches in April.