Greece pulled the rug out from under investors' feet, introducing fresh uncertainty over the risk of a sovereign debt default by saying it would hold a referendum on a crucial European debt deal that markets had considered a fait accompli.
Yes, the Greeks did give the world democracy, but governments and investors alike were stunned by the decision to turn over to the people what had largely been regarded as a done deal to save Greece from bankruptcy.
Britain's FTSE 100 fell 2.8 per cent, while France's CAC 40 and Germany's DAX plunged 4.2 per cent. The Athens stock exchange lost almost 7 per cent, while the euro fell another 1.2 per cent. Japan's Nikkei slid 1.7 per cent and Hong Kong's Hang Seng lost 2.5 per cent.
U.S. stocks appeared poised to open lower as well. Dow futures were down 160 points, or 1.3 per cent, at 11,737 about two and a half hours before Wall Street opened for business. S&P 500 futures fell 25.1 points, or 2 per cent, to 1,224.20.
Benchmark U.S. crude oil fell $2.39 to $90.80 (U.S.) a barrel.
Gold lost $21.20, trading at $1,704 an ounce.
The Canadian dollar traded at 98.82 U.S. cents.
The yield on the German 10-year bund slipped 16 basis points to 1.88 per cent.
Greece is due to receive an 8-billion-euro tranche of aid in mid-November, but is likely to run out of cash again in January, around the time when the referendum is likely to take place.
News that Greece's Finance Minister Evangelos Venizelos sought medical treatment after suffering stomach pains added to concerns in the markets.
The Financial Times points out: "Clearly, the Greeks have just brought back into play all the uncertainty last week's summit was meant to dispel."
Britain's Guardian newspaper says 60 per cent of Greek citizens currently reject the austerity measures.
(Der Spiegel, in the meantime, ran an interview with German Finance Minister Wolfgang Schauble headlined: Germany Does Not Want to Rule Europe.)
Meanwhile, thousands of protesters are converging on the French Riviera to urge the Group of 20 leading economies to focus on spreading global largesse instead of saving banks and pleasing financial markets. The G20 summit begins on Thursday.