Markets

European shares fall in wake of mass S&P downgrade

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At 0902 GMT, the FTSEurofirst 300 index of top European shares was down 0.5 percent at 1,013.17 points.

"A one-notch downgrade for France was completely priced in, so no negative surprise here, and quite logical after the United States got downgraded. But the question now is: how will this affect the EFSF rating?," said David Thebault, head of quantitative sales trading, at Global Equities.

Late on Friday, S&P cut the ratings of Italy, Spain, Portugal and Cyprus by two notches and France, Austria, Malta, Slovakia and Slovenia by one notch each.

It put 14 euro-zone states on negative outlook for a possible further downgrade, including France, Austria, and still triple-A-rated Finland, the Netherlands and Luxembourg.

Around Europe, UK's FTSE 100 index was down 0.4 percent, Germany's DAX index was down 0.6 percent, and France's CAC 40 was 1 percent lower.

France's Societe Generale was down 4.4 percent and BNP Paribas was 3 percent lower, while Italy's UniCredit was down 6 percent.

Copyright Reuters, 2012