Market update: European shares fall as Moody’s downgrades France

US stocks rallied on Monday as the glow of optimism for a deal to avoid the fiscal cliff continued; Congressional leaders said they are confident an agreement can be reached before Christmas. Additionally, better news on the housing front continued with the National Association of Realtors reporting that sales of existing homes climbed 2.1% in October to a seasonally-adjusted annual rate of 4.79 million units. The S&P 500, the Dow Jones and the Nasdaq all closed firmer, up 2.0%, 1.7% and 2.2% respectively. Sector-wise, technology stocks such as Apple and Cisco were among the gainers.

This morning, Europeans shares are edging lower on news that Moody’s has lowered France’s sovereign credit rating from Aaa to Aa1. In January, France was downgraded by Standard and Poor’s. In early morning trading, the FTSE Eurofirst 300 and FTSE 100 are both down 0.3%. Over in Asia, ahead of the national election on 16 December, the Bank of Japan decided to leave monetary policy unchanged despite mounting pressure from the main opposition leader Shinzo Abe for “unlimited easing” to revive the economy. The Nikkei 225 closed down 0.1% today.