European markets were knocked by fears of a Grexit this morning, after the collapse of emergency negotiations last night.
The FTSE 100 dropped 0.13 per cent, while Germany's Dax fell 0.7 per cent and France's Cac dropped 0.9 per cent.
Meanwhile, equities in Athens fell four per cent, led by banking shares, which dropped more than eight per cent. Greek 10-year bond yields jumped 1.5 percentage points to 9.46 per cent.
The falls came after talks between European finance ministers descended into acrimony last night, after Greek finance minister Yanis Varoufakis took objection to a draft statement, which required Greece to stick to its "current [bailout] programme".
Following the meeting, Varoufakis said he had been ready to agree to an extension of the existing programme, but added that the conditions imposed by the statement were too strong.
“[The original draft] was replaced with another document, that took us not just back to last Thursday, but indeed it took us back to last Wednesday – when we were pressurised to extend the current programme,” Varoufakis said.“It proved impossible for the Greek government, despite our infinite goodwill, to sign the offered communique.”