European shares suffered their steepest daily fall since January on Friday and the euro slumped against the dollar having pulled back from the two-month high it hit on Thursday.
Investors dumped banks as fresh cracks appeared in Greece’s bid to secure an international bailout and avoid a chaotic default.
The Greek stock exchange index closed down 3.2 percent, and of the big bourses Paris was the worst performer down 1.5 percent.
French banks, which have major exposure to Greece, experienced a sharp sell off and Gemany’s Commerzbank fell 5.2 percent on the Greek uncertainty.
Oliver Roth from Close Brothers Seydler in Frankfurt said: “There are still doubts on the market whether the Greek government will keep their promises concerning the troika and concerning the debt cuts. So there are still concerns on the markets and that puts some pressure on the markets.”
Adding to the downbeat mood China’s imports fell in January by the most since the depths of the financial crisis raising worries that demand may be dropping off more than previously thought, even taking into account shutdowns of Chinese business over the Lunar New Year.
That data splashed over on to miners.
The US trade gap for December also swelled as goods imports climbed to the highest level since July 2008.