European stocks close sharply lower after US data

Last Friday, there was a release in the US of the jobs report of November. The results of that report were very bad. Along the US Labor Department employers cut off 553,000 jobs. This is the highest number in 34 years. This large numbers shows us that our economy is in a very bad situation. The release had a negative impact on the global stock markets. Especially the European markets suffered a lot on Friday. The most European markets lost about 4 percent while wall street just lost 1.7 percent. This new situation tempers the enthusiasm that investors had last Tuesday when the European central bank cut the interest rate from 3.25 to 2.5 percent.

On Friday there was another bad announcement. The German Bundesbank predicts a 0.8 shrink of the German economy in the next year. That was a hard hit for European markets because Germany is one of the biggest economies in Europe.In Asia some stock markets lost something of their value while others gained.

I think this report will only put us in a deeper crisis. As you see, every time there is announced something bad, markets react immediately negative. The loss of 553,000 jobs is very bad for the economy. Those people don’t have spending power anymore. And that is what our economy needs.The fact that the German Bundesbank predict a shrink of the German economy could have a negative influence on the other European markets. Germany is always an indicator for other countries. So I expect that other countries will predict a similar shrink like Germany.

source: http://money.cnn.com/news/newsfeeds/articles/apwire/3f77f412878cfb56d21e8c135e5d0c57.htm