Pressure Tech Share News (PRES)

LONDON (Alliance News) - London stocks ended lower Monday, as equity markets across the world were hit by the the latest failure of talks between Greece and its creditors to deliver progress on "significant gaps" in reform plans for the cash-strapped country.

The FTSE 100 index ended down 1.1% at 6,710.52 points, while the FTSE 250 closed down 1.2% at 17,728.73. The AIM All-Share finished down 0.5% at 770.86.

Europe's major indices performed even worse, with the CAC 40 in Paris down 1.7% and the DAX 30 in Frankfurt down 1.8%.

When the European stock markets closed, Wall Street was lower with the DJIA down 0.7%, the S&P 500 down 0.6% and the Nasdaq Composite down 0.7%.

Greece's prime minister Monday urged the country's creditors to get "realistic", a day after weekend negotiations failed to bridge major differences, setting the stage for eurozone finance ministers to make a final push to reach a deal to avert a default.

Prime Minister Alexis Tsipras accused the institutions involved in the country's bailout negotiations of "political expediency" regarding their insistence on pension cuts. He said: "We do not have the right to bury European democracy at the place where it was born."

The European Central Bank joined Germany on Monday in insisting that the onus to resolve the Greek debt crisis now rests with Athens, as fears that Greece could eventually crash out of the eurozone triggered a new sell-off in equity markets.

"While all actors will now need to go the extra mile, the ball lies squarely in the camp of the Greek government to take the necessary steps," ECB President Mario Draghi told a hearing of the European Parliament in Brussels.

Draghi was echoing comments made earlier in the day by a spokesman for German Finance Minister Wolfgang Schaeuble.

"(The solution) now lies exclusively with Athens to respond to the generous offer made by the three institutions," the spokesman said, referring to the International Monetary Fund, the ECB and the European Commission.

He spoke after talks between cash-strapped Greece and its creditors collapsed on Sunday after the two sides once again failed to reach a deal to unlock the final EUR7.2 billion tranche of its bailout in exchange for Athens agreeing to a tough round of reform.

The comments came ahead of a crucial meeting of eurozone finance ministers on Thursday, where further talks on Greece's finances are to take place and just two weeks before an IMF debt repayment deadline and the expiry of the European part of the country's bailout.

"Draghi failed to clarify how much progress has been made on such a solution, likely because there hasn’t been any, whilst also refusing to speculate on the consequences of any potential Greek ECB repayment failures," said Spreadex analyst Connor Campbell.

Despite the deadlock in the talks, Athens insisted that it would meet its repayments.

"We believe there will be an agreement and there won't be any problem with repaying [the EUR1.6 billion the country owes to] the IMF at the end of June," Greek government spokesman Gabriel Sakellaridis said Monday. However, Sakellaridis went on to say that the Greek government has reached its limits on the counter-proposals it could submit.

"The Greek government submitted counter-proposals in order to cover the financing gap, as asked," he said.

In the US, investors are also cautious ahead of Wednesday's Federal Reserve interest rate decision. The Fed will also release a report including the Federal Open Market Committee's projection for inflation and economic growth over the next two years and a breakdown of individual FOMC member's interest rate forecasts.

In London, Standard Chartered was amongst the worst-performing stocks after Jefferies cut its price target on the bank to 656 pence from 722p, while keeping an Underperform recommendation. The broker said that incoming Chief Executive Bill Winters' need to improve capital ratios means the bank is likely to halve its dividend. Jefferies expects Standard Chartered's 2015 dividend per share to be 0.42p, down from 0.86p in 2014. Standard Chartered shares ended down 2.4% at 1,038.00p.

River and Mercantile Group Monday said it will manage a GBP700 million options mandate for the Royal Mail Pension Plan. The advisory and asset management business said it was appointed in April, with the structure of the mandate designed and executed in May. Royal Mail shares ended down 0.4% in the FTSE 100 while River and Mercantile, a main market stock not in a specific index, ended up 4.1%.

In the FTSE 250, NMC Health announced the acquisition of ProVita International Medical Center, a long-term medical care provider in the United Arab Emirates, for USD160.6 million in cash. NMC Health shares ended down 0.1%.

In the corporate calendar Tuesday, Whitbread issues a first quarter trading statement, Ashtead Group releases full year results and Crest Nicholson Holdings publishes half year results. Meanwhile, Record, Consort Medical, DJI Holdings and Trifast publish full year results. Servoca, Pressure Technologies release half year results, while Accsys Technologies issues a trading update.

In the economic calendar, the German consumer price index is due at 0700 BST. Meanwhile, UK consumer price index, retail price index and producer price indexes are due at 0930 BST. The German ZEW survey of economic sentiment is due at 1000 BST. In the US, housing starts data is due at 1330 BST, while the redbook index is due at 1355 BST.

By Daniel Ruiz; danielruiz@alliancenews.com

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