Greek stocks plunged Monday when the Athens Stock Exchange opened for the first time in five weeks, losing nearly 23 percent in the opening moments of trading, but later recovering some lost ground.
By day's end, the Greek market closed down 16 percent, with bank stocks battered as the Greek government struggles to negotiate a new bailout with its international creditors, the country's third in the past five years.
The sharp decline in stock values wiped $11 billion off the books.
"There is a sense of panic," said financial analyst Evangelos Sioutis at Guardian Trust, "...There are no buyers. And there are no buyers because the Greek economy has been hard hit by the imposition of capital controls and the bank closures. The outlook is not clear."
The sharp stock losses came as a new report showed Greek manufacturing plunged in July to its lowest level in at least 16 years. Last month was the low point of the country's financial crisis as it edged close to a default before its European neighbors agreed to negotiate the new bailout in exchange for Athens agreeing to impose new austerity measures, chiefly tax increases and pension cuts.
The government closed the stock exchange in late June when it also shut down banks and imposed limits on money withdrawals in response to the country's debt crisis.
Greece reached agreement with the European Union and International Monetary Fund last month to negotiate the new bailout and reopened its banks on July 20. Capital controls are still in place, and the government continues to talk with creditors on exact terms for a new rescue package that could be worth up to $94 billion.
Talks on the new bailout came after weeks of negotiations and controversy that included Greek voters rejecting an earlier bailout package in a referendum. Many Greeks oppose the type of harsh austerity measures creditors demand, saying they only have made the country's economic woes worse.
Some material for this report came from the Associated Press.
