Europe was on the brink of financial meltdown tonight as Greece’s political crisis threatened to bring down the single currency.
Opposition parties in debt-stricken Athens have until Thursday to form a government or face the turmoil of a fresh election.
The crucial next 48 hours will also see the first meeting between France’s new anti-austerity president Francois Hollande and Germany’s Angela Merkel tomorrow, which could see them clash over the future of the EU.
As the panic caused billions of pounds to be wiped of the share value of Britain’s biggest companies today, European finance ministers held emergency talks in Brussels to prepare for a doomsday scenario.
They fear a new Greek government will refuse to accept the austerity measures demanded by the European Union and the International Monetary Fund.
The bankrupt country would then be denied its next tranche of the £103billion bailout and could be forced out of the euro.
This could trigger a domino effect across the 17-strong eurozone with the contagion sparking a new banking crisis.
Former EU commission chief Romano Prodi warned: “Exit would bring down the whole house of cards, with one state falling after another: it would reach Portugal, Spain, then Italy and France.”