(MENAFN- AFP) European stock markets closed lower Friday as investors reacted to Greece delaying a debt repayment and to Athens' stalled negotiations with creditors.
The OPEC oil cartel meanwhile decided to maintain its current high production levels, which puts downward pressure on already low crude prices.
London's benchmark FTSE 100 index slumped 0.80 percent to end the day at 6,804.60 points compared to Thursday's close.
In the eurozone, the CAC 40 in Paris lost 1.33 percent to 4,920.74 points, and Frankfurt's DAX 30 dropped 1.26 percent to 11,197.15 points.
The European single currency dropped to $1.1117 from $1.1239 late in New York on Thursday, in the face of a stronger dollar reinvigorated by better-than-expected job creation in May.
Greece bought time in debt crisis negotiations with official creditors when it moved late Thursday to bundle four looming IMF loan payments into one, postponing pay day to the end of the month.
The rare move -- permitted by the International Monetary Fund only once before to Zambia -- allowed Athens to avoid a Friday deadline to remit about 300 million euros to the crisis lender.
The move bought Athens time as it weighs the newest proposal from its IMF, European Commission and European Central Bank creditors of freeing up 7.2 billion euros in blocked bailout funds Greece desperately needs to pay debts and avoid default.
"Greece's decision to emulate Zambia and bundle its June IMF payments has allowed another 'make or break' moment to pass without either, but the continued divergences between the country and its creditors have left it very close to the brink," analysts at Capital Economics said.
As a result, Athens' Athex Composite index suffered a 4.90 percent plunge to 786.11 points to end the day in Europe's sharpest decline.
"Ongoing concerns regarding Greece's debt issues continue to dominate trading sentiment in European equity markets... (and) the Athens Stock Exchange plunged to nearly 1-month low," said Sucden senior research analyst Myrto Sokou.
Wall Street stocks mostly declined in midday trade Friday after a strong US jobs report raised speculation the Federal Reserve could move more quickly to raise interest rates.
Nearing noon, the Dow Jones Industrial Average was down 0.17 percent at 17,874.45 points.
The broad-based S&P 500 dropped 0.86 percent to 2,095.84, while the tech-rich Nasdaq Composite Index inched up 0.04 percent at 5,060.91.
The US economy pumped out 280,000 jobs in May, far more than expected in a solid sign of growth after a winter stall. The report also showed better wage growth, a sign of labour market tightening.
Chris Williamson, chief economist at Markit, said the jobs report "puts a September rate hike firmly on the table" at the Fed.
- Eurozone has rebounded -
Asian markets mostly sank on Friday with traders nervously watching events in Europe over the Greek crisis.
Tokyo slipped 0.13 percent, while Sydney shed 0.11 percent -- a fifth-straight loss -- and Hong Kong tumbled 1.06 percent. Shanghai however rose 1.54 percent to 5,023.10 -- above 5,000 points for the first time since January 2008.
Despite the Greek economic drama, Europe's biggest economy Germany showed increasing strength in another positive sign for the eurozone.
"The Greek noise is deafening, but Greece is tiny, 1.7 percent of eurozone GDP. The main story in Europe is different," said Holger Schmieding, Berenberg chief economist, noting that the eurozone economy has rebounded to a 1.4 percent pace.
And Germany's central bank said that country's economy has shifted into higher gear powered by low unemployment, higher wages and a weak European single currency.
After notching up growth of 1.6 percent last year, Germany would see gross domestic product expand by 1.7 percent in 2015, 1.8 percent in 2016 and 1.5 percent in 2017, the Bundesbank said Friday in its latest monthly report.
In another positive development, ratings agency Standard and Poor's raised eurozone member Ireland's credit rating a notch to A+, citing its unexpectedly strong growth and debt reduction.
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