Europe Markets

Europe closes lower with Greece's future uncertain

Europe closes lower with Greece's future uncertain

European equities closed lower on Monday, after Greece voted "no" to reform proposals in the country's referendum on Sunday and the country's Finance Minister Yanis Varoufakis resigned.

The pan-European Stoxx Europe 600 finished the day around 1.3 percent lower. Major bourses pared losses in the afternoon, however all closed in the red.

U.K.'s benchmark FTSE 100 index ended the day down around 0.8 percent, while the French CAC closed 2 percent lower and the German DAX was down by 1.5 percent.

Peripheral bourses suffered the most, with Italy's FTSE MIB closing around 4 percent lower.

All of Europe's main industry sectors closed in the red.

However, shares in French, Italian and Spanish banks took a hit following concerns over their exposure to the fallout from the Greek crisis. BMPS shares tanked to close down 11.5 percent and Banco Popolare fell to close over 6.5 percent, while BBVA was down 3.2 percent.

Rolls Royce was one of the day's worst performers on the Stoxx Europe 600, after the British engineering company downgraded its profit forecasts for this year and 2016. Shares in the firm tanked as much as 9 percent, before paring losses to close around 6.3 percent lower.

Deutsche Post however was one of the day's standout performers, with shares closing up over 2.2 percent after the German company reached a deal with a trade union over pay that had led to a number of strikes and disrupted business.

At 16.30 p.m. London time on Monday, U.S. stocks failed to hold gains, trading mildly lower amid continued uncertainty over the Greece debt crisis.

What's next for Greece?

Varoufakis resigns: Good news for Greece?

All eyes in Europe are on Greece after 61 percent of Greeks voted against reform proposals from creditors, which entailed austerity measures and many spending cuts.

The vote has put Greece in unknown political and economic territory, with a potential exit from the single currency now more likely than ever.

Euro zone leaders are to meet at a summit on Tuesday to discuss their next move.

Read MoreGreece's 'nays' have it - how markets will react

The Greek stock market remained closed on Monday, as did banks in the country. Capital controls are still in place, but whether the European Central Bank (ECB) will maintain its emergency funding for Greek banks is uncertain.

Greek Finance Minister Yanis Varoufakis stepped down on Monday, saying in a blog post that he was was "made aware of a certain preference by some Eurogroup participants, and assorted 'partners', for my… 'absence' from its meetings."

Read MoreWhy Angela Merkel won't back down on Greece: Fisher

There were no major European earnings or data releases Monday.

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