Greek stocks fall sharply

The general index on the Athens stock exchange closed down 7.9 percent at 464.23 points -- a 25-year-low -- while banks suffered a 24.3-percent average drop. Top companies such as the Public Power Corporation, the Piraeus Port Authority and prominent construction firms lost between four and and 12.5 percent. The downturn came amid a general European stock market slump as investors cashed out of banking shares following recent poor earnings, with worries over China΄s economy and falling oil prices also weighing on sentiment. But in Greece investors had additional reasons to head for the exits, with the government seen to be facing an impossible choice between further austerity and social unrest. The Athens stock exchange had already lost 9 percent of its value last week, with the banking index taking a beating with a drop of over 24 percent. The main banks had gained a little ground after receiving a recapitalisation boost in December, six months after a disastrous tug-of-war between the leftist government of Prime Minister Alexis Tsipras and Greece΄s EU-IMF creditors forced the imposition of capital controls and nearly wiped out the value of their shares. Greece last week wrapped the first phase of a fiscal review by its EU-IMF international creditors, with no agreement in sight on a controversial pension reform that has caused a social backlash against Tsipras΄ fragile coalition.