European stocks remain lower on debt worries; DAX plunges 2.62%

Investing.com - European stock markets remained sharply lower on Monday, as sustained concerns over the debt crisis in the euro zone and the U.S. deficit continued to dampen market sentiment.

During European afternoon trade, the EURO STOXX 50 tumbled 2.56%, France’s CAC 40 plummeted 2.66%, while Germany’s DAX 30 plunged 2.63%.

Earlier in the day, the spread between 10-year Spanish bond yields and their German counterparts widened as investors remained jittery despite the election of a new government.

Also Monday, rating agency Moody's said a rise in French government debt yields and weaker growth prospects could be negative for the outlook on the country's credit rating.

Meanwhile, the failure of a U.S. congressional "super committee" to agree on a package of measures to slash USD1.2 trillion off the U.S. deficit over the next 10 years sparked fresh selling in riskier assets.

Financial stocks extended losses, led by Belgian lender KBC Groep NV with shares diving 11.36%. Meanwhile, France’s BNP Paribas plunged 5.82% and Societe Generale plummeted 4.97%, while German lender Deutsche Bank tumbled 3.86%.
 
Peripheral lenders were also sharply lower with Italy’s Intesa Sanpaolo dropping 2.38% and Unicredit declining 1.79%, while Spanish lenders BBVA and Banco Santander sunk 2.40% and 2.01% respectively.

Elsewhere, Statoil saw shares tumble 2.20% after Norway’s national oil company agreed to sell stakes in fields to Centrica Plc for USD1.6 billion.

In London, commodity-heavy FTSE 100 plunged 1.96% as miners were among Monday’s top losers.

Copper producer Xstrata saw shares dive 3.60%, closely followed by Kazakhmys, plummeting 4.46%.

Meanwhile, mining giants Rio Tinto and Bhp Billiton declined 4.75% and 3.19%, while British Petroleum dropped 1.62%.

The financial sector was also sharply lower as U.K. lenders tracked their European counterparts. Shares Lloyds Banking dove 6.61% and Barclays plunged 4.49%, while Anglo American and the Royal Bank of Scotland tumbled 3.33% and 3.11% respectively.

In the U.S., equity markets pointed to a sharply lower open. The Dow Jones Industrial Average futures pointed to a loss of 1.36%, S&P 500 futures signaled a 1.61% plunge, while the Nasdaq 100 futures indicated a 1.07% drop.

Later in the day, the U.S. was to release industry data on existing home sales.