ATHENS (Reuters) - Greece’s stock market closed with heavy losses on Monday after a five-week shutdown brought on by fears that the country was about to be dumped from the euro zone.

A European Union flag flutters outside the Athens stock exchange, Greece, July 27, 2015. REUTERS/Ronen Zvulun

Bank shares plummeted 30 percent before loss limits kicked in to stop investors selling any more. The main Athens stock index .ATG ended down 16.2 percent, recovering slightly after plunging nearly 23 percent at the open.

It was the worst daily performance since at least 1985 when modern records began, including a 15 percent fall when Wall Street crashed in 1987.

By contrast, the broad European FTSEurofirst 300 index was in positive territory for the day.FTEU3 [.EU]

“The market tanked, as expected,” said Takis Zamanis, chief trader at Athens-based Beta Securities.

Banking shares, which make up about 20 percent of the Greece index, were particularly hard hit. The overall banking index .FTATBNK was down to its 30 percent daily limit.

All five shares comprising the index .FTATBNK - National Bank of Greece NBGr.AT, Alpha Bank ACBr.AT, Piraeus Bank BOPr.AT, Attica Bank BOAr.AT and Eurobank EURBr.AT - were locked down for much of the session at the limit with no buyers.

Greece’s banks have seen deposits severely depleted as Greeks pulled out their euros for fear they would be forcibly converted into a new drachma outside the euro zone. The banks have been propped up by emergency money from the European Central Bank.

Traders said they expected more bank-share losses in the next session.

“Bank shares look like they have more room to slide on Tuesday before bids emerge,” said one fund manager who declined to be named. “It will take a few days for the market to balance out.”

Some companies outperformed, mainly those with exposure abroad, although they still fell.

“Buyers emerged for non-bank stocks, blue chips like OTE Telecom and (gaming group) OPAP, which shows that there is buying interest out there,” Zamanis said.

OTE, which accounted for around 30 percent of the day’s turnover, lost 11.5 percent.

There were only nine gainers, mainly small caps and with very small volume, exaggerating the moves. One, furniture maker Dromeas SA DROr.AT, gained almost 29 percent after clinching a 30 million-euro deal to supply European Commission offices.

FEARS FOR FUTURE

Trading on the Athens bourse was suspended in late June as part of capital controls imposed to stem a debilitating outflow of euros that threatened to collapse Greece’s banks and hurl the indebted country out of the euro zone.

Since then, Athens has agreed a framework bailout plan with its European Union partners in exchange for stringent reforms and budget austerity.

But implementation of the deal is some way off, keeping alive the threat of political and economic instability. There is also concern that Prime Minister Alexis Tsipras may need to call a snap election.

Monday’s losses stemmed from a number of reasons. Negotiations on the new bailout might bog down, for example, leaving the government and banks perilously short of cash.

A report on Sunday in the newspaper Avgi, which is close to Syriza, said the government was seeking 24 billion euros ($26.37 billion) in a first tranche of bailout aid from international lenders in August.

Of this, the newspaper said, 10 billion euros was earmarked for an initial recapitalization of Greek banks, 7.16 billion euros to repay an emergency bridge loan and 3.2 billion euros to repay Greek bonds held by the European Central Bank and others.

In an interview with Ethnos newspaper on Monday, European Economic Affairs Commissioner Pierre Moscovici described an August deal as possible, but added it would be “ambitious”, suggesting that it would take hard work to achieve it.

Meanwhile, Greeks themselves are being severely restricted on the bourse. To limit the possibility of using shares as part of euro-flight, the government and ECB have said no extra money can be withdrawn by Greeks from deposit accounts to buy shares.

Greece’s dismal economic prospects may also weigh on the market. The European Commission says the Greek economy will shrink by 2 to 4 percent this year, a return to the recession that plagued the country for six years until 2014.

On Monday, a survey showed Greek manufacturing activity plunged to a record low as new orders plummeted and the three-week bank shutdown caused serious supply problems.

Greece’s economic sentiment also hit its lowest level in almost three years in July, a monthly report by the IOBE think tank showed.