World stocks diverged and the euro wavered as investors fretted over what direction the eurozone debt crisis would take after voters in Greece and France turned against German-led austerity.
World stocks diverged and the euro wavered on Monday as investors fretted over what direction the eurozone debt crisis would take after voters in Greece and France turned against German-led austerity.
Analysts said any impact of the victory of Socialist Francois Hollande mattered less than the outcome in Greece where a protest vote sharply reduced the chance of a stable government and put a hard won rescue deal into jeopardy.
But despite the anti-austerity votes, German Chancellor Angela Merkel mounted a spirited defence of belt-tightening in the face of the eurozone crisis and said she had no plans to change course.
The Paris stock exchange's CAC 40 index had opened down 1.52 per cent, amid concerns that EU voters are hardening their opposition to deficit-cutting austerity programmes, but later rallied to show a 0.68-per cent gain in afternoon trading.
Shares in Italy and Spain, countries with huge sovereign debt exposures, also switched gears with Madrid's IBEX 35 index up a sharp 1.90 per cent and Milan 1.63 per cent higher.
But in Germany, the eurozone powerhouse and paymaster, shares persisted in negative territory with Frankfurt's DAX 30 down 0.14 per cent. London's exchange was closed for a holiday.
Stocks in Athens plunged 7.78 per cent after Greece's mainstream parties fell short of a governing majority, putting hard won agreements to save the country's economy and membership of the eurozone back into question.
US stocks opened modestly lower with the Dow Jones Industrial Average down 0.37 per cent, the S&P 500 losing 0.24 per cent and the tech-heavy Nasdaq off 0.34 per cent.
In Asia, stocks slumped with Tokyo diving 2.78 per cent and Hong Kong down 2.61 per cent, hit by the European votes as well as weak jobs data from the United States at the end of last week.
The euro fell to $1.2954, the lowest level since late January, but then rallied to USD 1.3033 at 1230 GMT, but still below $1.3082 in New York late on Friday.
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