Greece’s second largest political party says it now plans to scrap a promise with the European Union (EU) to implement cutbacks in return for rescue loans.

Syriza party head, Alexis Tsipras, said on Tuesday that Greece should back out of its promise, calling the country's austerity agreements with the EU "null and void”. His remarks came after the antiausterity Syriza Party came in second in Greece’s general elections last Sunday, behind the New Democracy Party, which actively sought to form a coalition with various parties.

In response, European leaders, including European Council President Herman Van Rompuy and German Chancellor Angela Merkel, stressed that it is Greece’s obligation to fulfill agreements on retrenchment.

Following Tsipras’ remarks, European and U.S. stock prices fell sharply.