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Efforts to calm European markets mount, but fail

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The stocks continued to drop until strong U.S. jobs data helped propell solid gains on Wall Street late in the European trading day. BNP Paribas closed up 0.3 percent and Societe Generale rose 3.7 percent.

The European Union's markets supervisor said regulators were increasing surveillance of financial markets following the days of steep selloffs. Greece on Monday banned short-selling — profiting from bets on the decline in a share price — but no other national regulators have followed suit so far. Consob, Italy's stock market watchdog, said it would meet on Friday morning before the markets open to decide whether or not to take measures about short-selling, which has been blamed for contributing to market volatility.

France is taking pains to assure markets that it won't be the next to see its credit rating downgraded.

Sarkozy cut short his holiday Wednesday and ordered his ministers to come up with new budget cuts to ensure that France sticks to deficit-cutting targets.

All three leading credit rating agencies reaffirmed their triple-A assessment of France, and analysts said they could not identify a trigger for the market turmoil.

"There's nothing behind it, it's a market of malintentioned speculators trading on pure rumors," said Marc Touati, an economist at French trading firm Assya Compagnie Financiere.

After Societe Generale, France's second-biggest bank, saw its share price drop nearly 15 percent Wednesday, the bank asked the French market regulator, the AMF, to investigate the rumors that it was on the ropes because of its heavy exposure to debt from troubled eurozone economies.

Societe Generale CEO Frederic Oudea called the rumors "totally unfounded" and "irrational." Speaking on France-Info radio, he urged calm and insisted that the bank's fundamentals are sound.

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