EU seeks to save the euro

Associated Press

PARIS

Seeking to restore confidence in the euro, the leaders of France and Germany jointly have called for changes to the European Union treaty so that countries using the euro would face automatic penalties if budget deficits ran too high.

But not everyone on Wall Street was reassured that Europe would get control of its 2-year-old debt crisis.

Stock prices rose and borrowing costs for European governments dropped sharply in response to the changes proposed Monday by French President Nikolas Sarkozy and German Chancellor Angela Merkel.

But some of the optimism faded late in the day when Standard and Poor’s threatened to cut its credit ratings on 15 eurozone countries, including the likes of Germany, France and Austria, which have been considered Europe’s safest government-debt issuers.