Market news is not good as investors are spooked over recent events in Greece and France. Both countries have been at the heart of the ever-present debt crisis in the EU, but recent events have plunged them even further into controversy. There are still fears that Greece will default and exit the EU whilst the recent triumph of France’s Hollande on an anti-austerity ticket.

With new leadership in France and Greece’s protests against austerity, there is truly growing concern that both countries will default on loans, forcing their exit from the single currency. In fact, the value of some of Britain’s largest companies decreased by £25 billion as traders rushed to dump what they view as ‘risky assets’ in order to place their investments in safer markets. This has triggered what is being referred to as a ‘fresh crisis.’

Since the beginning of this year, the EU did see a period of relative stability but all this came to a screeching halt after France’s election of a new president who rose to victory on his anti-austerity stance. With Greece mired in a hung parliament, concerns are mounting that both countries will default on bailout loans.

An emergency meeting of the EU leaders has been called for May 23 in which the president of the EU, Herman Van Rompuy, looks to open discussion on fostering growth amidst popular complaints against austerity measures in those countries. Traders are concerned that political unrest will prompt an insurmountable debt crisis, especially in France and Spain, so they are seeking safer havens for their investments.

The market is focused on safe havens at the moment and with Greece sure to challenge EU authorities in June and France’s anti-austerity leadership, investors are pulling their backing which has taken a huge toll on UK businesses. Throughout all this, Spain is expected to ask for further funding whilst all eyes look towards Germany to do more to help struggling countries. Whether or not the EU powerhouse will live up to expectations is yet to be seen.

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