FXstreet.com (Barcelona) - European markets are going lower on Wednesday with investors optimism dampened by downbeat Japanese GDP data, and news about a credit-rate cut on Greece, which add to concerns about Dubai's debt crisis; on FX markets, Euro and Pound attempt to pick up from lows while Yen strengthens across the board.

Eurostoxx 50 Index drops 0.7%, while the German DAX index trades 0.65% down and the French CAC Index sheds 0.5%. In the UK, the FTSE Index trades 0.45% below its opening level.

Banks' stocks are mixed with Standard Chartered dropping 0.8% despite news about its income and pre-tax profit reaching the highest levels for the year so far. On the positive side, Volkswagen shares have soared 2.0% up after the carmaker announced its alliance with Suzuki, and the purchase of 19.9% of the Japanese company's stake.

Euro and Pound attempt recovery

EUR/USD decline from 1.5140 resistance area last week has extended to a fresh 5-week low at 1.4665 on Asian session, and the pair has picked up during European session, reaching intra-day high levels at 1.4770 at the moment of writing.

GBP/USD decline from 1.6700 area last week extended to a fresh 3-week low at 1.6165 during Asian session, to bounce up during European trade and reach 1.6315 session high, where the Pound seems to have found resistance. At the moment of writing, Sterling trades at 1.6290.

USD/JPY has depreciated further during European session, as the pair broke below 88.15 support, to reach a new week low at 87.35, where the pair has found support to bounce up to levels around 87.85 at the moment of writing.