On Monday, European stocks declined. This came as investor sentiment was negatively impacted by the moves made in Greece to close their stock market as well as their banks as talks with creditors failed.
All eyes are now on Greece and the big question as to if the country will default on its debt.
Monday saw French and German shares experience their worst declines since the 1st of November 2011. In France, the CAC 40 (PX1, -3.74%) declined by 3.7 percent to 4,869.82 while the DAX 30 (DAX, -3.56%) in Germany dropped 3.6 percent to 11,083.20.
Other European markets which were negatively impacted were seen in the United Kingdom where the FTSE 100 (UKX, -1.97%) dropped 2 percent to 6,620.48 while the IBEX 35 (IBEX, -4.56%) in Spain also lost 4.6 percent to close at 10,853.90.
Added to the day of declines, the Stoxx Europe 600 (SXXP, -2.69%) also marked its biggest decline since October last year. This index declined to 386.43, down 2.6 percent. This decline was led by a drop in banking shares (FX7, -4.04%) which dropped by more than 4 percent.
Interestingly, on Monday, only sixteen index components posted gains such as Ocado PLC (OCDO, +1.01%), a British online grocer whose shares advanced 1.2 percent after a report was released that the company is currently preparing to expand overseas.
Also on the downside was the PSE 20 index (PSI20, -5.22%) in Portugal which declined 5.2% to 5,530.50. This marked the biggest decline for the index since early July 2013. Meanwhile, in Italy, stocks (FTSEMIB, -5.17%) dropped 5.2 percent to 22,569.95 which also marked the index’s worst day since November 2011.
Meanwhile, in Greece, the stock market (GD, +2.03%) will be closed all week. Added to this, Greek banks will also be closed until the 6th of July which is after a referendum will take place in the country on the 5th of July.
Over the weekend, Alexis Tsipras, the Greek Prime Minister announced that a referendum would take place which would ask voters whether to accept reform measures demanded by the country’s lenders. On Monday, the European Commission called on the people of Greece to vote “yes” in next week’s referendum stating that should a “no” vote prevail, the European Union would be otherwise fractured.
Meanwhile, the banks in Greece are only allowing locals to withdraw $66.70 or 60 euros per day out of the ATM machines.