November 21, 2011 / 4:42 PM / in 6 years

Europe shares tumble on euro zone, US debt levels

LONDON, Nov 21 (Reuters) - European shares fell to their lowest close in nearly seven weeks on Monday, as U.S. political deadlock on its deficit added to investors’ worries about the euro zone’s debt crisis, made worse by Moody’s warning on France.

The FTSEurofirst 300 index of top European shares fell 3.1 percent to end the session provisionally at 921.37 points, the lowest close since Oct. 5.

Cyclical stocks such as miners were among the biggest casualties on worries the euro zone crisis would lead to recession, and hurt demand for metals. The STOXX Europe 600 Basic Resoureces Index fell 6 percent.

“There’s a chronic lack of political leadership either side of the Atlantic. They’re showing they’re not up to the task,” said Bill Dinning, head of investment strategy at Kames Capital in Edinburgh, which has 48.8 billion pounds ($76.4 billion) under management.

Rating agency Moody’s Investors Service expressed worries that a recent rise in interest rates on French government debt and weaker economic growth prospects could be negative for the country’s credit rating.

A congressional “super committee” was expected to concede defeat in its bid to lower the U.S. deficit.

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