Stock markets fell, pressured by collapse talks over the near-bankrupt Greece

Stock markets around the world fell on Monday, pressured by the collapse of 11th-hour talks between the near-bankrupt Greece and its creditors, with investors worried about the possibility the country could default.

Risky assets like equities and crude oil were widely lower, though major stock indexes ended off their lows of the session and the euro recovered from earlier weakness against the dollar to trade slightly higher.

Talks on Sunday between Greece and its creditors broke up after less than an hour. European Union officials said Athens had offered no new concessions to secure the funding it needs, while Athens said it would not give in to demands for more pension and wage cuts. Greece must repay 1.6 billion euros ($1.8 billion) to the International Monetary Fund by mid-year.

“This market is moving toward the position of an increasing probability that there is going to be a Greek default,” said Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont. “We’ve never had a country part of the euro currency system default, so we don’t really know what the impacts are going to be.”

The Dow Jones industrial average .DJI fell 107.54 points, or 0.6 percent, to 17,791.3, the S&P 500 .SPX lost 9.67 points, or 0.46 percent, to 2,084.44 and the Nasdaq Composite .IXIC dropped 21.13 points, or 0.42 percent, to 5,029.97. The benchmark S&P earlier fell 1 percent before recouping about half of that decline in afternoon trading.

The all-country MSCI International ACWI Price Index .MIWD00000PUS fell 0.7 percent, while the pan-European FTSEurofirst 300 .FTEU3 closed down 1.6 percent, pressured by losses in bank stocks. The Hang Seng index .HSI in Hong Kong ended 1.5 percent lower. Both European and Asian markets closed prior to the partial recovery in the United States.

The CBOE Volatility index .VIX, a measure of U.S. investor anxiety, rose 11.7 percent, while a gauge of European stock market volatility .V2TX popped 10.2 percent and hit its highest since January.

U.S. Treasury yields fell after New York manufacturing data disappointed and on concerns of a Greek default and possible ejection from the euro zone. The benchmark 10-year U.S. Treasury note US10YT=RR rose 7/32 in price, pushing the yield down to 2.3559 percent.

In the currency market, the euro EUR= rose 0.15 percent against the U.S. dollar, moving to $1.1284 and recovering from an earlier low of $1.1188. The U.S. dollar index .DXY, which measures the greenback against a basket of currencies, fell 0.21 percent. The yen JPY= was flat against the dollar.

Investors were looking ahead to a meeting of U.S. Federal Reserve policymakers this week, and especially towards their statement after the two-day meeting ends on Wednesday.

Strong U.S. data last week has reinforced expectations that the central bank is on track to raise interest rates, possibly as soon as September. Investors will focus on any changes in Fed Chair Janet Yellen’s language at a post-meeting news conference.

U.S. crude futures CLc1 settled at $59.52 per barrel, down 0.7 percent, while Brent LCOc1 settled down 2 percent at $62.61.

Gold XAU= rose 0.5 percent on the day while silver XAG= rose 1 percent. Copper CMCU3 fell 1.6 percent.