European markets dropped while yields on Greek bonds leapt this morning, as investors showed their concerns over the possibility of a Greek exit from the euro.
The FTSE 100 fell more than one per cent, while Germany's Dax lost almost two per cent and the French Cac 40 fell 1.5 per cent, after Greek prime minister Alexis Tsipras ruled out extending Greece's bailout. Athens Stock Exchange was down more than five per cent.
In a defiant speech on Sunday, Tsipras refused to back down on the spending programme he outlined before the general election, despite winning little support for his plans from the country's European neighbours during a tour of the bloc last week.
Greek 10-year bond yields rose above 11 per cent in morning trading, while three-year yields jumped above 19 per cent. Meanwhile, yields on German 10-year debt dipped as low as 0.35 per cent.
To compound fears, yesterday, former US Fed chief Alan Greenspan told the BBC Greece will "have to quit the Eurozone" if Tsipras is serious about pursuing his plans.
I believe [Greece] will eventually leave. I don't think it helps them or the rest of the Eurozone - it is just a matter of time before everyone recognises that parting is the best strategy.
Connor Campbell, a financial analyst at Spreadex, suggested the bearish trend experienced by markets last week is likely to continue into this week.
Things don’t look likely to change in these early hours of trading with the day providing little in the way of economic news to cling on to.