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Saturday, May 5, 2012

Wall Street Week Ahead: All eyes on European elections



Traders work on the floor of the New York Stock Exchange, May 4, 2012. REUTERS-Brendan McDermid

After Wall Street ended its worst week of the year on Friday, U.S. stock investors will look across the Atlantic next week to take their cue from Europe as France and Greece go to the polls.

That could offer some respite from a string of weak U.S. economic data and the earnings season winding down.

Markets worldwide have closely watched developments in Europe for the past several months, with calls for austerity seen as positive for stocks as they seek to prevent a credit crisis in the region that could take down or deeply hurt the global economic recovery.

But an economic slowdown throughout the region has amplified calls for a change of direction.

In France, the prospect of a victory by Francois Hollande over conservative incumbent Nicolas Sarkozy, which would instate the country's first Socialist president since 1995, initially alarmed some investors. Hollande's win could be a hurdle to the German-led drive for austerity in Europe.

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