Stock markets across Europe have reacted badly to the results of yesterday's first round results in the French presidential elections and the imminent collapse of the government in the Netherlands.
French President Nicolas Sarkozy came second to socialist rival Francois Hollande in Sunday's poll – with a deciding vote to be held in a fortnight, there is much uncertaintly about the outcome.
Adding to investor concerns this morning is the failure of budget talks in the Netherlands which appear set to end the current government's hold on power.
As a result, shares dropped sharply in Germany (2.5%), while the FTSE and the Cac40 in France were off by around 1.5% in early trading.
Adding to woes in Germany were figures which showed the country's manufacturing activity fell to an almost three-year low.