Wall Street Breakfast: Must-Know News

Fitch has just downgraded the UK from AAA to AA+ - now lower than France's.

The France-based ratings agency has just joined China's Dagong, and US Moody's by Fitch-slapping Italy with a BBB ratings handle. Citing four main reasons: election results which and 'non-conducive' for further structural reforms, deeper than expected recession, greater than expected budget deficits, and a weak government less able to respond to shocks. But apart from all that, as we noted earlier, Italian stocks and bonds are bid.   Via Fitch:

Just crossing the wires. Below is the full release. --------------------------------

Wall Street Breakfast Editors submit:Top StoriesEurozone crisis hits Germany as GDP contracts in Q4. The eurozone's woes finally hit Germany's economy in Q4, when GDP contracted a preliminary 0.5%, which was greater than expected and marked a deterioration from +0.2% in Q3.

Wall Street Breakfast Editors submit:Top StoriesEU: Eurozone recession to continue into 2014. The European Commission has cut its outlook, predicting the economy will contract by 0.3% this year after shrinking by 0.6% in 2012 and then return to growth of 1.4% in 2014.

Wall Street Breakfast Editors submit:Top StoriesCanceled House vote roils markets A decision by House Republicans to cancel a vote on their "Plan B" tax proposal sends a chill into global markets. Asian stock markets ended their session firmly lower, while European stocks show similar nervousness over the fiscal cliff drama.

Wall Street Breakfast Editors submit:Top StoriesIMF: EU countries to miss budget targets. Spain's budget deficit will hit 7% of GDP in 2012 and 5.7% in 2013, thereby missing EU-agreed targets of 6.3% and 4.5% respectively as the country recapitalizes its banking sector, the IMF has forecast.

Wall Street Breakfast Editors submit: by Rachael Granby and the Market Currents team