Greek Stocks Slump 6% over Political Uncertainty
Greek stocks lost over 6.5 percent on Tuesday after the government unexpectedly brought forward a high-stakes presidential election, sparking fears of a political stalemate.
The Athens general index fell to 967 points an hour after opening, as analysts warned that the uncertainty could stall Greece's fiscal reforms.
"A Greek accident remains a potent risk...the risk of a political backlash and reform reversal is thus very real for now," analysts Berenberg said in a note.
The vote by 300 members of parliament to replace President Karolos Papoulias had been due in February but has now been set for a first round on December 17. A second and third round are scheduled for December 22 and 27.
It is seen as a key test for embattled Prime Minister Antonis Samaras, who with his narrow majority of 155 seats is unlikely to propel his candidate to a first round win.
He would need 180 votes if forced into a likely third and last round.
Failing victory, Samaras would have to call a snap general election at a time when polls indicate radical left party Syriza -- which has pledged to reverse many of the reforms imposed by the country's EU-IMF creditors -- is favored by voters.
Source: Agence France Presse
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