- Fitch sees a risk of a US downgrade if there is another debt ceiling crisis
- Italian unemployment shoots higher
- Weak Chinese data and worries over sequestration weigh on sentiment

FTSE-100: -0.71%
Dax-30: -1.05%
Cac-40: -1.44%
FTSE Mibtel 30: -1.94%
Ibex 35: -1.06%
Stoxx 600: -0.96%

Eurozone equities had slipped further into the red by midday in reaction to poor labour market data out of Italy, news that China´s State Council could take further measures to cool its property market and simmering worries over 'sequestration' in the United States.

As if poor manufacturing data in China overnight were not enough, according to Market News International China´s State Council may impose further controls on the ownership of second homes.

Meantime, and Stateside, the looming start of cuts to US government spending - known as 'sequestration' - is also weighing on sentiment. The question which traders must answer is when the cuts will bite enough so as to force Congress to reach an agreement.

In any case, analysts from ratings agency Fitch have today warned that another debt ceiling crisis in the United States could result in a downgrade of the country´s sovereign debt rating.

Eurozone periphery yields have turned higher.

All of the above comes ahead of a barrage of macroeconomic data releases this afternoon in the US.

Thales rides full-year results higher

French military electronics outfit Thales is rocketing higher after posting full-year profits which beat expectations.

Belgacom were off sharply after its financial guidance fell short of forecasts.

Sergio Marchionne, the Chief Executive of both Fiat and its majority-owned Chrysler Group unit, sees a 50% chance that Chrysler will go public, although he prefers a merger with Fiat.

French media giant Vivendi may freeze the sale of its Brazilian telecommunications unit GVT as bids are coming in at less than what was expected, Reuters reports.

From a sector stand-point the best performance on the DJ Stoxx 600 is now to be seen in the following industrial groups: Banks (-2.83%), Basic resources (-2.71%) and Automobiles (-1.88%) (1.23%).

Italian unemployment shoots higher

Italy´s unemployment rate shot higher in January, reaching a level of 11.7% after a reading of 11.3% in the month before.

Eurozone consumer prices rose at a 1.8% year-on-year pace in February (Consensus: 1.9%).

Eurozone unemployment rose by no less than two tenths of a percentage point in January, to 11.9% after a reading of 11.7% in the previous month.

German retail sales grew by 3.1% month-on-month in February (Consensus: 1.0%).

The Markit Eurozone purchasing managers´ index for the month of February has come in at 47.9 (Consensus: 47.8), after a reading of 47.8 in the month before.

Euro teetering on 1.30 level

The euro/dollar is now lower, by 0.52%, to the 1.3000 dollar mark.

Front month Brent crude futures are now falling by 0.933 dollars to the 110.35 dollar per barrel level on the ICE.

AB

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