The German market is in negative territory in afternoon trading Wednesday, after Standard and Poor's downgraded the credit rating outlook on Greece. Sentiment was impacted by mixed earnings news and traders also tried to take some profit from recent gains.
Standard and Poor's downgraded the credit rating outlook on Greece to 'negative' and said worsening economic activity would make it difficult for the government to make further spending cuts, which is crucial to secure the next disbursement under the international bailout program.
The outlook on the country's long-term sovereign credit rating was revised to 'negative' from 'stable', while the 'CCC/C' long- and short-term foreign and local currency sovereign credit ratings remained intact.
The Euro Stoxx 50 index of eurozone bluechip stocks is falling 0.61 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is losing 0.14 percent.
The DAX index is declining 0.66 percent.
Lufthansa is declining 3.4 percent, thus topping the losers. ThyssenKrupp is falling 1.9 percent and Metro is losing 1.6 percent.
BMW and Daimler are notably lower while Volkswagen is losing modestly.
HSBC cut Lanxess to 'Neutral' from 'Overweight.' The stock is falling 1.2 percent.
Fraport, the owner of Frankfurt Airport, reported lower earnings for the second quarter, even as revenues benefited from increased passenger traffic. The stock is falling 2.2 percent.
Brenntag shares are down 0.4 percent after the chemical distributor reported higher profit for its second quarter as sales climbed despite difficult market conditions.
Steel and metal products distributor Klöckner slipped to a loss in its first half hurt by charges. The stock is losing 3.3 percent.
Elsewhere in Europe, the French CAC 40 is losing 0.60 percent and the UK's FTSE 100 is declining 0.48 percent. Switzerland's SMI is dropping 0.33 percent.
In economic news, Germany's industrial production decreased a calendar and seasonally adjusted 0.9 percent on a monthly basis in June, reversing the previous month's revised 1.7 percent increase.
German trade surplus unexpectedly increased in June as imports declined at a pace double than that of exports, indicating that the sovereign debt crisis and the economic slowdown has dampened both domestic and foreign demand.
The Bank of England lowered growth estimate for the U.K. as fiscal consolidation and Eurozone debt crisis weigh on demand. In its quarterly Inflation Report, the BoE said economic growth is likely to be around 2 percent in two years, down from the 2.6 percent expansion estimated in May.
Across Asia/Pacific, Australia's All Ordinaries added 0.5 percent, China's Shanghai Composite Index rose 0.2 percent and Japan's Nikkei 225 rose gained 0.9 percent. However, Hong Kong's Hang Seng edged down 0.04 percent.
In the U.S., futures point to a lower open. In the previous session, traders expressed renewed optimism about the possibility of further monetary stimulus. The Dow rose 0.4 percent, the Nasdaq jumped 0.9 percent and the S&P 500 advanced 0.5 percent.
In the commodity space, crude for September delivery is falling $0.69 to $93.17 per barrel and December gold is losing $1.8 to $1611.0 a troy ounce.
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