European stock markets finished lower Wednesday, as investors remained uninspired by Greece's latest bailout deal and expressed disappointment about data showing that business activity in the region unexpectedly slowed.
Although Greece has, in principle, secured a second bailout deal, questions remained on its implementation and effectiveness.
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"Serious reservations about the ability of the Greek government to push through the required fiscal cuts have hampered any positive market reaction so far," said Lee McDarby, head of dealing at Investec Corporate Treasury.
"This being said, the market's ability to shrug off the European issues is astonishing," McDarby added.
Indeed, action taken by Fitch Ratings by putting Greece in selective default has been shrugged off by the market, with analysts saying it was already widely expected.
Fitch cut Greece's credit rating to C from CCC and reiterated that a bond-swap agreement with private creditors would be a restricted default.
But, a reading on business activity in the euro zone, which unexpectedly contracted in February, added pressure on sentiment. Markit Economics' purchasing managers' index fell to 49.7 from January's 50.4, below expectations of a rise to 50.8. Readings below 50 imply contraction.
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