US markets posted heavy losses for the second successive day of trading, amid fears Greece is set to default on a €5bn debt payment due next week.
According to the FT, Greece, which was granted a €174bn bailout by the European Central Bank, is struggling to meet the €5bn debt obligation.
With Greece stalling, eurozone leaders now face a new round of brinkmanship on how to reduce Greece's sky-high debt levels.
Coupled with fears over the fiscal cliff in the US, investors moved to take profits for a second day, with the Dow shedding 120 points or 0.94% to close at 12,811 overnight. The fall left it at a three-month low.
Meanwhile, the S&P 500 fell 1.22% to 1,377, one of its biggest one-day declines year to date.
As well as woes in Europe, US lawmakers yesterday warned growth in the world's largest economy would take a 3% hit next year if the Bush-era tax cuts are not maintained or extended.
Meanwhile in the UK today, markets got off to a lacklustre start, with the FTSE 100 down 20 points to 5,756. The index closed lower on Thursday.
View from the front row
Project Libra unveiled
Including SJP and investment trusts
Spent two years at Sanlam
Will also assess FCA's actions