The broad market welcome for the outcome of the Greek election has petered out as investors ponder the next hurdle in tackling the euro crisis.
Asia was first to react to the will of the Greek people, who decided to give the biggest share of the vote to pro-bailout party, New Democracy .
The euro jumped to a one-month high while the Nikkei in Tokyo rose nearly 2% - the election result seen as crucial to European leaders' efforts to hold the euro together.
European stock markets also made a strong start on opening, with the FTSE 100 climbing 1.4% and miners seeing the biggest gains.
The German DAX was 1.3% up while the CAC in Paris was 1.1% higher.
However, the recovery was short-lived as the positive sentiment was eroded an hour into the European trading session.
While the result was seen as easing concerns of a sudden Greek departure from the single currency, attention quickly turned to Spain.
The Spanish IBEX and Italian MIB had enjoyed a brief relief rally, as their countries arguably had the most to lose from a Greek anti-austerity vote, it also turned sour.
Spain's 10 year debt yield jumped to 7.1%, the level seen as unsustainable for a country's borrowing costs.
Both Spain and Italy have come under renewed pressure recently as contagion spread from Greece, with Spain needing to take a 100bn euro rescue package for its crippled banking industry earlier this month.
European economist at Daiwa Capital Markets, Tobias Blattner, told Sky News: "All of this uncertainty surrounding Greece is still with us.
"We still don't know whether the new Government will actually be able to implement these very very tight reforms.
"When we look in particular at Spanish and Italian bond yields they still remain at very very high levels. So much more needs to be done than just avoiding a Greek exit," he said.
