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European markets down on Greek political limbo

  • European markets were in the red on Monday morning as the growing political uncertainty in Greece dampened investor sentiment.

    Greek President Karolos Papoulias failed to form a unity government during talks on Sunday. He is expected to continue discussions with party leaders into the evening.

    Spanish and French markets appeared the worst hit towards the start of trade with Madrid’s Ibex index down 2.3 percent and the Cac 40 down two percent.

    London’s FTSE 100 was down 1.3 percent and Germany’s Dax down 1.6 percent.

    Greece’s lack of a government has raised doubts over its ability to stand by austerity measures required as part of its bailout.

    Last Sunday’s elections saw voters punish parties that backed the financial bailout.