European stock markets fall on Greek and Spanish political concerns

lunes 25 de mayo de 2015 06:28 GYT

* Greece's ATG index falls on renewed debt default worries

* Spanish stock market drops after local election results

* Volumes thin with London, Frankfurt and New York closed

By Atul Prakash

LONDON, May 25 (Reuters) - European equities fell on Monday, with the Spanish and Greek stock markets hit by investors' concerns over Greece's debt problems and a poor local election result for the Madrid government.

Athens' main index equity index fell 1.2 percent after Greece's interior minister said on Sunday the country would not be able to make debt repayments to the International Monetary Fund next month unless it makes a deal with creditors.

Spain's IBEX equity index also fell 2.1 percent after the ruling People's Party took a battering in regional and local elections on Sunday. Voters punished Prime Minister Mariano Rajoy for four years of severe spending cuts and a string of corruption scandals.

Even though most investors believe that Greece will remain in the euro zone, stock market dealers said the latest comments coming out of Athens were enough to make traders nervous.

"Investors are very nervous because the chance of a default has clearly increased," said KBC's senior economist Koen De Leus. "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."   Continuación...