Black Tuesday on Greek stock market

 Benchmark suffers biggest drop in 27 years as foreign investors rush to sell on fears of snap general election

Greek stocks suffered their worst day in decades on Tuesday as fears of a snap poll that could stall reforms and bring the country back to the brink of default resurfaced after the government brought forward the presidential election. Bond prices also declined considerably on the day.

Fears of a bank run in case of a poll win by the leftist SYRIZA party, highlighted by domestic and foreign commentators, sent most foreign investors dashing to exit the Athens market, even though neither a government failure to elect a new Greek president by the end of the month nor SYRIZA’s rise to government if indeed snap polls are called are certain.

The Athens Exchange (ATHEX) general index closed at 902.84 points, shedding 12.78 percent from Monday’s 1,035.08 points. The large-cap FTSE/ATHEX 25 index contracted 12.93 percent to 292.16 points.

Just under 8 billion euros was wiped off the market’s capitalization.

Trading volume reached 212 million euros.

Observers had to reach for the record books to find that the biggest one-day Greek benchmark decline of all time was 27 years ago, as on December 7, 1987 the general index plunged 15.03 percent.

In more recent times the biggest drop had been recorded on October 24, 2008 when the benchmark fell 9.71 percent, but that was dwarfed by yesterday’s crash.

MIG and PPC fell by more than 23 percent, while banks gave up 16.62 percent.

Losses grew following the announcement of the government’s candidate for the presidency, as the index was only 8 percent down at the time of Prime Minister Antonis Samaras’s statement proposing Stavros Dimas for the post. This suggests that the markets...

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