December 9, 2011, MarketWatch
U.S. stocks lost sizeable ground Thursday as public sparring among European Union members jolted the market late in the session.
“There is such a thing as too much transparency, because there is too much posturing. This is very typical tactics, to leak out stuff about what you want to try to get the upper hand; unfortunately this is not stuff for such an important meeting,” said Marc Pado, U.S. market strategist at Cantor Fitzgerald.
The market came off its lows late in the session after Dow Jones reported details of a draft proposal at the EU summit. But then the indexes sank further, with the Dow average sinking as much as 230 points, after Reuters cited a senior German source in saying Germany opposed some measures in the draft conclusions.
All eyes are now on a crucial meeting of European Union leaders in Brussels.
EU leaders are under pressure from ratings agencies and bond investors to devise a comprehensive plan to rein in sovereign debts that have sent some countries to the brink of default. Germany’s Angela Merkel has supported a stronger fiscal union that could penalize members if they don’t abide by deficit limits; some EU members don’t want such changes.
“It’s having a body that has authority to look at something versus the ability to sanction. Germany wants sanctions if you don’t meet the requirements of the EU committee,” Pado said.