European shares post lowest close in 7 weeks

By @ibtimes on

European shares fell on Wednesday to their lowest close in seven-weeks after dismal demand at a German bond auction sparked fresh debt crisis contagion worries and weak Chinese factory data added to concerns about slowing global growth.

The weak auction, which saw a low bid-cover ratio, raised fresh concerns about the impact on Germany of the region's debt problems, with investors worrying about the growing costs attached to the crisis.

Richard Batty, strategist at Standard Life Investments, part of the Standard Life Group, which administers 196.8 billion pounds of assets, said the weak demand was a surprise.

It is now getting to the stage where investors are becoming concerned about Germany paying more of the bill for the euro zone. The country is being tarnished with the same negative sentiment of other parts of the euro zone.

The pan-European FTSEurofirst 300 <.FTEU3> index of top shares provisionally closed down 1.1 percent at 904.56 points and made its lowest close since October 4.

Belgian lender KBC fell 8.7 percent to become one of the biggest fallers in Europe as the yield premium of Belgian 10-year government bonds over German Bunds hit a euro-era high. (Reporting by Joanne Frearson)

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