Stock market falls on European economy forecasts

With the election over, stock traders' turned their attention to the European economy, currently being dragged down by a debt crisis for more than three years.

U.S. stock futures were higher overnight after Obama cruised to victory. They turned sharply lower after the European forecasts and discouraging comments from Mario Draghi, president of the European Central Bank. European markets turned negative as well.

The European Commission, the executive arm of the EU, said that it expects the region's economic output to shrink 0.3 percent this year. In the spring, the group predicted no change.

Now that the U.S. election has been resolved, it's natural for traders to focus on Europe's problems, said Peter Tchir, who manages the hedge fund TF Market Advisors.

What they're tuning in to, he said, is the failure of a major European summit last week and minimal progress on the issues that are holding the region back.

"People can only digest one or two stories at a time, and people had put Europe on the back burner" before the election, he said.

(source)