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Stocks fall as Greek deadline looms

Published 30/06/2015

Events in Greece are causing tremors in world markets
Events in Greece are causing tremors in world markets

European stock markets fell for a second day in a row as Greece looks set to miss a 1.6 billion euro (£1.1 billion) payment today, moving the country a step closer to leaving the euro.

London's FTSE 100 Index fell another 37.7 points to 6583.4, following yesterday's 2% decline, while the Dax in Germany and France's Cac 40 both dropped a further 1% after plunging nearly 4% on Monday.

The pound was a cent up on the euro, at just under 1.41, after hitting a seven-and-a-half year high against the euro on Monday as worries about Greece defaulting on its debts and leaving the single currency took their toll.

Connor Campbell, a financial analyst at broker Spreadex, said: "Understandably the eurozone indices have continued to dip further into the red following yesterday's calamitous day of trading, as investors await the outcome of this historical moment."

US stocks were also hit, suffering their worst day of the year after the Greek saga took another turn, with the country's banks shutting their doors as it prepares for a referendum that will effectively decide whether to stay in the euro.

The Dow Jones industrial average lost 350.33 points, or 2%, overnight - wiping out all the gains seen so far this year.

Athens looks likely to default on its payment to the International Monetary Fund (IMF) by today's 10pm deadline, with its current bailout also expiring at the same time.

Greece has been in talks for months with its three creditors - the IMF, the European Central Bank (ECB) and the European Commission.

The stricken country has closed its banks for a week and will see voters on Sunday decide on the latest deal put forward by its creditors.

Greek prime minister Alexis Tsipras has urged the country to vote against austerity proposals, but EU leaders have warned that rejection would mean Greece leaving the eurozone.

Big fallers on the FTSE 100 Index include supermarkets Tesco and Sainsbury's, which both fell by more than 2% on the back of data by research body Kantar, which showed that their market shares fell as a result of the ongoing supermarket price war.

However, heavyweight miners such as Antofagasta and BHP Billiton also fell by around 2%, as the gloom around Greece dragged down most sectors in the FTSE 100 Index.

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