France elected Socialist leader Francois Hollande as the country's new president after he pledged to work towards ending Europe's austerity drive, while anti-austerity parties performed strongly in Greece. The euro fell more than one per cent to a three-month low of $1.295, although it later rallied to $1.3031. Uncertainty about the future of austerity measures and the Greek bailout also hit share prices. The French CAC 40 was down 1.8 per cent during morning trading but subsequently recovered, while the German DAX fell by 2.3 per cent. In Athens, shares were 8 per cent lower, with the Greek banking sector down 16 per cent. The situation in Greece and the prospects for its bailout are a major concern for the markets, after the radical left group Syriza and the ultra-nationalist Golden Dawn organisation both experienced surges in support. Analysts are worried the anti-austerity parties will block the spending cuts and tax rises imposed as a condition of the bailout. Justin Harper of IG Markets told the BBC: 'The Greek side of things is a ticking time bomb. 'The fear now is that all the hard work that had gone into getting the second bailout package may start to unravel and we can expect some real pressure on stock markets in the coming days.' Asian stock markets also fell in the wake of the election results in Europe, with the Nikkei in Tokyo down 2.8 per cent and Hong Kong's Hang Seng 2.4 per cent lower. Markets are closed in London due to the bank holiday.

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