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London - Greek stocks fell sharply on Monday as caution prevailed ahead of a presidential vote that threatens the future of the country's international bailout.
If lawmakers fail to elect a successor to 85-year-old Karolos Papoulias, that would trigger a snap national election which polls suggest would be won by the anti-bailout Syriza party.
Such a victory, feared by many investors, would galvanise anti-austerity and Eurosceptic movements across the euro zone periphery, such as Spain's Podemos and Italy's Five-Star Movement.
Blue-chip indexes in Greece fell 5.5% at 10:49 and peers in Italy and Spain shed 1%, weighed down by falls in banks, which are heavily exposed to domestic economies and sovereign bonds.
Greece's Piraeus Bank National Bank of Greece and Alpha Bank were the top fallers in Europe as they shed between 10% and 12%.
"There is selling sparked by the uncertainty of likely early elections," said Theodore Krintas, head of wealth management at Attica Bank. "Electing a president today is looking difficult and this is reflected by the market's fall."
The eurozone-wide Euro STOXX 50 index was down 0.5% in thin volume of just 9% of the index's daily average for the past three months.
The pan-European FTSEurofirst 300 index was flat at 1 347.76 points, while Britain's FTSE 100 rose 0.2%, helped by a bounce in mining stocks.
The market had been shut over Christmas and many traders were still away this week.
"Anyone who wants to get involved in the market today will wait until the Greek election results come out," said Frederic Boissel, head of cash equity and exchange traded funds at Tradition Securities and Futures.
