Europe Factors-Shares to fall as Greece faces more conditions

February 10, 2012 3:07 AM EST

European shares were set to open lower on Friday as concerns of a messy Greek debt default persisted after the euro zone finance ministers set more conditions for Greece to secure a second bailout following a deal by Greek leaders on reforms.

The Eurogroup Chairman Jean-Claude Juncker said the Greek parliament must ratify the package when it meets on Sunday and a further 325 million euros of spending reductions needed to be identified by next Wednesday, after which euro zone finance ministers would meet again.

"Despite yesterday's agreement between party leaders over the austerity measures, traders still remain sceptical over whether they (Greece) can avoid a default," Jonathan Sudaria, dealer at Capital Spreads, said.

"Concerns were raised that Greece still hasn't done enough to satisfy the criteria to receive a bailout."

Greece has fallen deeper into recession since it received a first bailout in May 2010. The EU and the International Monetary Fund are exasperated by a string of broken promises by Athens and weeks of disagreement over the terms of a 130 billion euro (108 billion pounds) bailout, with time running out to avoid a chaotic default.

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"The Greek saga continues and EU leaders are clearly making the point that there is no more room for any 'free ride'," Newedge Strategy said in a note.

Futures for Euro STOXX 50, Germany's DAX and France's CAC were 0.9 to 1.2 percent lower.

Investors will keep a close eye on banking shares after Barclays said its key investment bank arm ended last year with its worst quarter for three years as the euro zone debt crisis hit bond trading activity, dragging the British bank's annual profit down on the year before.

Mining shares could come under pressure as prices of key base metals fell on concerns about demand for raw materials. Copper prices fell more than 1 percent, while zinc was down 1.2 percent.

Asian shares fell on Friday, with MSCI's broadest index of Asia Pacific shares outside Japan <.MIAPJ0000PUS> down 1.5 percent. On Thursday, the FTSEurofirst 300 index <.FTEU3> of top European shares finished 0.3 percent higher at 1,073.53 points.

On the macreconomic front, U.S. international trade data for December is due at 1330 GMT, while preliminary figures from the Thomson Reuters/University of Michigan Surveys of Consumers will be released at 1455 GMT.

China's trade in January fell the most since the depths of the financial crisis, raising concerns Lunar New Year factory shutdowns do not fully explain a slump in imports and may instead be evidence of a further faltering in demand.

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