FTSE and euro plunge as Greece fears intensify

The FTSE has plunged in afternoon trading and the euro slumped to a 14-month low against the dollar on fears Greece's financial troubles will spill over into neighbouring states.

It is the second day fear over Greek contagion has gripped European markets as violence broke out in Athens. At least three people were killed as protesters set fire to a bank during a general strike over planned austerity measures, which were a condition of the £95bn bailout plan agreed at the weekend. The European Commission (EC) also said today it expected the Greek economy to contract 3% this year. Growth in the eurozone as a whole has been upwardly revised from 0.7% to 0.9% but the Commission warned the region's economic recovery continues to be clouded in uncertainty. Markets...