Greek equities are being hammered on Wednesday with Athens Stock Exchange’s benchmark index losing 5.1% at 899.65, with traders citing political uncertainty jitters and a spike in Greek bond yields.

Today’s plunge follows a loss of 5.7% yesterday. Greek stocks are down over 9% in the last two days – the biggest plunge in 6 years

Greek ASE index plunges: Eurozone crisis 2.0?

Earlier, Athens has indicated plans to exit the 240-billion-euro EU/IMF package by the end of the year and finance its needs from bond markets starting next year. However, Wednesday’s steep rise in Greek’s 10-year bond yields to over 7.6% has dampened these plans.

Greek Global X Funds

Citing Kathleen Brooks, research director at Forex.com, CNBC’s Kartina Bishop points out Greece could head into a possible “euro zone sovereign crisis 2.0” with the yield on Greek 10-year government bonds continuing to trade well above 7%. In a note, Brooks said: “If you cast your mind back three years… when Europe’s struggling periphery saw their bond yields cross above 7 percent, it was considered the point of no return.”

The twin blow from the spike in bond yields and subsequent steep fall in the stock market come amid growing concerns about Athens’ plans to exit its bailout ahead of schedule. On Saturday, Prime Minister Antonis Samaras won a confidence vote in parliament, forcing lawmakers to back his plans to exit its international aid program early.

Investors’ concern

The investors’ main concern is the political uncertainty in Greece, in view of the election of the President of the Hellenic Republic, and also the results of latest polls showing the leftist opposition party SYRIZA with a 6.5% lead over the ruling New Democracy party.

Interestingly, in its publication titled: “The Chronicle of the Great Crisis: The Bank of Greece 2008-2013”, Bank of Greece highlighted that the Greek economy has come a long way and argued the country’s economy seems poised to recover.

In April, Moody’s investor Service also upgraded its outlook for the banking system of Greece from negative to stable. The rating agency’s revised outlook reflected its expectations of return to growth of its domestic economy in 2014 to 2015 after suffering six years of economic recession.