Shares have tumbled after Greece’s voters vehemently rejected conditions set by the country’s international creditors, deepening doubts over its future in the 19-nation eurozone.
Greece’s debt problem has long overshadowed the markets and with a European summit expected on Tuesday, the implications of Sunday’s “no” vote remain unclear.
The initial response to the Greek referendum was negative, but not panicked.
In early trading, the UK’s FTSE 100 slipped 0.7 percent to 6,543.09, while Germany’s DAX lost 1.2% to 10,926.13. France’s CAC 40 lost 1.4% to 4,739.66.
“The referendum’s result adds another layer of uncertainty to a very uncertain situation,” said Diego Iscaro, a senior economist for IHS Global Insight.
“Negotiations will resume over the coming days, but the probability of a deal is distant.”
Mr Iscaro said he expected the European Central Bank to continue providing liquidity to Greece’s financial sector while the International Monetary Fund seeks a way out, possibly by promising debt relief in exchange for an agreement by Athens to set certain austerity targets.
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Source: TOM