Stocks, euro fall on German debt crisis comments

US and European stocks fell on Monday and the euro slipped after Germany dashed hopes that the euro zone debt crisis would be resolved at next Sunday's summit of European leaders.

US stocks suffered their worst loss in two weeks after comments from Germany's finance minister caused investors to fear Europe's solution to its debt crisis may not come fast enough.

The S&P index had risen for two straight weeks for the first time since July, riding a wave of euphoria built on optimism that European leaders had a newfound commitment to tackle a crisis that threatened financial stability and global growth.

The Dow Jones industrial average was down 246.58 points, or 2.12 percent, at 11,397.91. The Standard & Poor's 500 Index was down 23.72 points, or 1.94 percent, at 1,200.86. The Nasdaq Composite Index was down 52.93 points, or 1.98 percent, at 2,614.92.

Meanwhile, European shares closed lower after German finance minister Wolfgang Schaeuble said it was unrealistic to expect a definitive solution to the euro zone debt crisis at an EU summit this weekend.

The pan-European FTSEurofirst 300 index of top shares fell 1 percent to 966.04 points. Trading volume was 85 percent of the index's 30-day average.

The Nikkei average rose to a six-week high, helped by hopes for corporate earnings and expectations that Europe will come up with a plan to contain its debt crisis, though some market players expect the rally to run out of steam soon.

The Nikkei added 1.5 percent to 8,879.60 -its best finish since Sept. 2, while the broader Topix index gained 1.8 percent to 761.88.