Europe stocks sink on global growth, euro zone fears

PARIS Thu Aug 4, 2011 11:45am EDT

PARIS Aug 4 (Reuters) - European stocks tumbled on Thursday, with a key index dropping to a level not seen since mid-2009, as investors dumped equities across the board, worrying about sluggish global growth and Italy's debt woes.

The FTSEurofirst 300 .FTEU3 index of top European shares unofficially closed 3.2 percent lower at 995.12 points, tumbling below the 1,000 mark for the first time in 12 months.

The euro zone's blue chip Euro STOXX 50 .STOXX50E index fell 3.3 percent to a two-year low of 2,415.86 points.

"The fact is: we don't see big volumes in the options market with people buying protection. Investors are massively getting out of stocks, period. And it might take a while before they come back," said Jean-Yves Dumont, head of asset allocation strategy and funds, Dexia Asset Management.

The selloff in European equities this week has wiped out more than 400 billion euros off the market capitalisation of German, British, French, Italian, Spanish and Dutch blue-chps indexes -- almost the size of the 440 billion euros capacity of the rescue fund set up by the European Union. (Reporting by Blaise Robinson)

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