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IN PHOTO: Athens, GreeceAnti-austerity protesters burn a euro note during a demonstration outside the European Union (EU) offices in Athens, Greece June 28, 2015. Greece said it may impose capital controls and keep its banks shut on Monday after creditors refused to extend the country's bailout and savers queued to withdraw cash, taking Athens' standoff with the European Union and the International Monetary Fund to a dangerous new level. REUTERS/Alkis Konstantinidis

In the wake of the announcements of bank closure made by the Greek government while rejecting the terms forwarded by its creditors, the Australian share market has been left to face the worse. Probably it is the first one to react to the breakdown. The situation took a drastic turn when the Greek PM Alexis Tsipras introduced a referendum all of a sudden on July 5th.

The share market saw a quick drop of 2% right after the announcements. The Guardian reported that Australia faced about AU$45.72 billion loss in the early hours of trading as investors await Greece’s exit from the eurozone. According to the Australian, this major plunge has been reported as the lowest point in the past few months.

IG market strategist Evan Lucas suggested, “Mitigation is all that can be done.” He further expressed his concerns saying, “It’s a very tough time and unfortunately nothing will be spared, except perhaps gold.”CMC Markets chief analyst suggested that the global financial markets would face major drop in their trading units in the coming weeks. However, he also mentioned that effects on Australian shares would not be that crucial as Greece does not have a direct influence on it.

Major Banks of Australia remained worried about the plummeted market shares. Commonwealth Bank of Australia fell about 1.64 percent losing AU$ 111.36 whereas ANZ lost 2.05 percent to AU$ 42.37. The Australian further reported that Westpac retreated 2.03 per cent to AU$ 42.26 while National Australia Bank gave up 2.02 per cent to AU$43.64. New Zeland and Japan also faced similar depreciation. Nikkei fell about 2 percent while the New Zealand and Korean markets traded at 1 percent lower each.

The Guardian mentioned that the GREXIT would also lead to the probing of other European Union countries like Spain and Italy, for they face similar debt crisis. Meanwhile, the Australian confirmed that the Reserve Bank of Australia might cut down on interest rates. The crisis has forced the market to announce another expected cut by October 2015.

Contact the writer on:- priya.shayani@gmail.com

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