Greek, French, Italian shares fall in thin trading
* Greece's ATG index down 2.5 pct on debt default worries
* Sentiment also worsens on hints of U.S. rate hike this year
* Italian, Spanish stocks fall sharply; Fiat shares slip
By Atul Prakash
LONDON, May 25 (Reuters) - European equities fell on Monday, tracking Friday's losses on Wall Street and as a Greek minister said Athens cannot make debt repayments next month unless Greece reaches a deal with its creditors.
Greece's ATG index fell 2.5 percent on the comments by Interior Minister Nikos Voutsis during a weekend TV show. After four months of talks with its euro zone partners and the IMF, the leftist-led government is still scrambling for a deal that could release up to 7.2 billion euros ($7.9 billion) in remaining aid to avert bankruptcy.
"Investors are very nervous because the chance of a default has clearly increased," said Koen De Leus, senior economist at KBC in Brussels. "But I believe that Greek politicians understand the seriousness of the issue and will ultimately arrive at a common ground to have an agreement with the creditors."
The benchmark French CAC 40 index was down 0.8 percent by 0823 GMT in cautious trading, mirroring losses in the United States on Friday after Federal Reserve Chair Janet Yellen hinted at a possible rate hike this year.
In comments made after European markets closed Yellen said that delaying a policy tightening until employment and inflation hit targets risked overheating the economy. Continuación...