Italian slump leads European shares lower
Published 21/02/2013 | 17:04
A sharp fall on the Milan stock market hit European shares on Thursday, with uncertainty over this weekend's Italian elections pushing a key eurozone equity index to its lowest level since the start of 2013.
The euro zone's blue-chip Euro STOXX 50 index provisionally closed down 2.3pc at 2,580.20 points, marking a fresh low for 2013 and sending it to its lowest close since ending at 2,575.25 points on Nov. 30.
The pan-European FTSEurofirst 300 index fell 1.5pc to 1,151.76 points - its worst finish since ending on 1,148.28 points on Feb. 7.
Italy's benchmark FTSE MIB was Europe's worst-performing stock market, falling 3.1pc, on uncertainty over the outcome of the elections on Feb. 23-24.
Most investors expect a centre-left government headed by Pier Luigi Bersani and backed by current prime minister Mario Monti to win and continue with reforms to tackle Italy's debt problems.
However, a resurgence by former leader Silvio Berlusconi has caused growing doubts over the outcome.
"If Berlusconi were to get more votes than currently forecast, and no government can be formed, it may provoke a market rout, with serious European contagion," said Integrated Asset Management head Emanuel Arbib.