By Simon Miller

Markets have opened down as Greece faces a reported noon-deadline to reach a deal over austerity measures.

After marathon talks on Sunday, a socialist party spokesman told reporters that leaders of the three coalition parties must respond by noon ECT on Monday and a meeting of political leaders would follow later in the day. However, a government spokesman has denied that there is a deadline.

Coalition partners are continuing talks in a bit to agree new austerity measures to receive a €130bn (£108bn) second bailout from the EU but failed to reach agreement over political anger over conditions to the cash injection.

Although private debt holders have in principle agreed a 50% haircut and a reduced coupon on new Greek debt, the ‘Troika’ demand further cuts in the public sector and a reduction in the minimum wage.

During the talks on Sunday, the Greek prime minister Lucas Papademos held emergency phone calls with the head of the International Monetary Fund Christine Lagarde and European Central Bank chairman Mario Draghi in a bid to satisfy the demands of the Troika and private debtholders.

There are just six weeks left before Greece faces a €14.5bn call on its debt but coalition partners LAOS and New Democracy party attacked the pressure to impose even harsher cuts on the county.

After five hours of talks on Sunday with socialist and conservative politicians, leader of the far-right party LAOS George Karatzaferis told reporters that he would not contribute to “the explosion of a revolution from destitution that will burn all of Europe”.

The FTSE 100 has dropped over 25 points since opening and is trading at 5,873.81 (as of 10.15 GMT) while the CAC 40 is down 40.61 points at 3,387.31.

The euro was down 0.24% against the pound and 0.71% on the dollar has traders watch for developments.

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