Friday 3 July 2015 12:00 pm

Greek referendum: European markets dip as court prepares to rule on referendum

European markets closed down today as Greek court prepared to rule on the legality of Sunday's referendum on creditors' bailout conditions.

Read more: Even pro-Europeans admit the Greek crisis has been disastrous for the EU

The FTSE 100 closed down 0.67 per cent, while Germany's Dax closed down 0.37 per cent and France's Cac was 0.57 per cent lower. 

Greece's Council of State has met to consider the legality of Sunday's referendum. Critics have pointed out that with capital conditions in place, it may be difficult for those registered to vote on small islands to reach their hometowns within the seven days' notice provided by the government. 

Meanwhile, European Commission president Jean-Claude Juncker warned that Greece's position will be "weakened" if it votes no. That marks a softening of the language used yesterday by Dutch finance minister and Eurogroup President Jeroen Dijsselbloem, who warned yesterday that, contrary to what Greek Prime Minister Alexis Tsipras had said, creditors would be unlikely to negotiate further with Greece if it voted "no"

However, an opinion poll by Alco and published in the Greek Ethnos newspaper  suggested a "yes" vote in Sunday's Greek referendum looked increasingly likely. Some 44.8 per cent of the population supported creditors' conditions, it found, while 43.4 per cent said they would vote "no". Some 11.8 per cent said they are undecided.

The news comes after a fraught day yesterday, in which Greek leaders ramped up the pressure on voters, with finance minister Yanis Varoufakis saying he will resign if voters go in favour of reforms proposed by Greece's creditors.

Later in the day the International Monetary Fund (IMF) warned Greece will need €52bn (£37bn) to keep going over the next three years

Although it had previously suggested Greek public debt would continue to be "substantially higher" than GDP until at least 2022, yesterday it said the government's actions over recent weeks are likely to make things worse. 

"Greek authorities have closed the banking sector, imposed capital controls, and incurred arrears to the IMF. These developments are likely to have a significant adverse economic and financial impact," it said.