Yes and for many reasons:
1.- Some companies or pension funds, etc. only buy AAA products. Without that precious rating you lose potential buyer.
2.- These countries live on debts. Bad rating => higher costs => taxes increases or spending cuts (which is an easy programm these days in Europe ;) ). Note: France is not the US, investors have not the same trust into them.
3.- GDP, jobless rate, export balance, etc: French are out and German are in which will have hugh impacts on the solidarity fund, political credibility, etc. (And remember French are still sensitive about having a Germany not dominating the Europe.)
The worst part is that Germany has kept its AAA. This means that the downgrade does not punish a "European problem" but a "Country problem", and this will have hugh impacts during this election year and for solving the issues in European.
The worst part is that Germany has kept its AAA. This means that the downgrade does not punish a "European problem" but a "Country problem", and this will have hugh impacts during this election year and for solving the issues in European.