Greek debt worries weigh on markets

European stock markets continue to be directed by the ongoing Greek debt saga, which has yet to see any significant progress.

Shares reversed their initial move higher to trade in negative territory by midday, with Greek bank stocks taking the biggest hits.

Reports today showed that the Greek government still hopes to reach a deal by the end of May, despite little progress being made in negotiations so far. Talks between Greece and its European creditors continue to be deadlocked by Greek resolve to avoid harsh austerity measures.

Meanwhile, markets were shaken by a letter that detailed just how close Greece came to defaulting last week.

A Greek newspaper published a letter from the Greek prime minister, Alexis Tsipras, to Christine Lagarde, chief of the International Monetary Fund (IMF). The letter warned Lagarde that Greece would not be able to repay the IMF without financial aid.

The news has investors worrying that Greece will not be able to make its next repayment on June 5th, raising the possibilities of it defaulting. Focus will remain on negotiations later this week with the hope of a productive outcome.