Euro zone stocks fell on Monday as renewed fears over the borrowing costs of Spain and Italy eclipsed initial relief over Greek election results that lessened the likelihood of an imm inent mes sy exit from the euro zone.

The euro zone's blue chip Euro STOXX 50 index unofficially ended 1.2 percent lower to 2,154.08 points, while the broader FTSEurofirst 300 index of top European shares closed 0.01 percent higher at 993.36 points, after gaining as much as 1.1 percent in morning trade.

While Athens' ATG index rallied 3.6 percent on the day, other euro zone peripheral indexes were hammered, with Italy's FTSE MIB losing 2.9 percent and Spain's IBEX dropping 3 percent.

Banks were the biggest losers, with Bankia down 9 percent, UniCredit down 4.3 percent and Banco Santander down 4.6 percent.

It's been 'buy the rumour, sell the news' on the Greek election vote, with people quickly cashing in last week's gains, said Frederic Rozier, a fund manager at Meeschaert Wealth Management, in Paris.

We're back to worries about Spain and a distrust in the euro zone in general. The question on everyone's mind is: at which level do Spanish bond yields become unbearable?