* Greek lawmakers fail to elect new president
* Athens' ATG equity index falls, hitting European markets
* Spanish and Italian markets also weaken
* UK's FTSE outperforms, helped by rise in gold miners
By Francesco Canepa and Sudip Kar-Gupta
LONDON, Dec 29 (Reuters) - Greek shares slumped on Monday, knocking European stock markets, after lawmakers rejected the government's candidate for president, leaving Greece facing a snap election that could derail its bailout programme.
Sole candidate Stavros Dimas, a former European Commissioner, fell short of the 180 vote supermajority needed to become president. He secured 168 votes in parliament, the same score he achieved in the second round.
Greek Prime Minister Antonis Samaras announced a snap election on Jan 25. Opinion polls point to a victory by the radical leftist Syriza party, which wants to wipe out a big part of Greece's debt, and cancel the terms of a bailout from the European Union and International Monetary Fund that Greece still needs to pay its bills.
The benchmark ATG Athex General Composite Share Price Index fell 6.4 percent, leaving it near levels not seen since 2012. The Athens index had already slumped due to fears that Dimas would fall short, dropping 12.8 percent on Dec. 9, and is down 31 percent in 2014.
IG market analyst Alastair McCaig said the Greek result could affect the European Central Bank's (ECB) plans for new economic stimulus measures to tackle the economic weakness afflicting Europe, such as quantitative easing ('QE').
"Although this is a specific issue for Greece, it will raise fresh fears over the fate of the euro zone and the timelines for the possible implementation of a European version of QE.
"2015 could see an escalation in the debate over austerity, with the same old north-south divide on what is proportional still raging," McCaig said.
GREEK BANKS SLUMP
Greek banks bore the brunt of the hit to the Athens market, with Bank of Piraeus dropping 9 percent after earlier touching record lows, while National Bank of Greece fell 10.3 percent.
The Greek result also hit stock markets in Spain and Italy. Both southern European nations were hit similarly hard by the euro zone economic slump and sovereign debt crisis which led to Greece's 2010 bailout.
Spanish and Italian bond yields rose, pushing Madrid's IBEX down 1.8 percent while Milan's FTSE MIB fell 2.2 percent, and the euro zone's blue-chip Euro STOXX 50 index fell 0.9 percent.
Andy Ash, head of sales at Monument Securities, said there was a good chance that the ECB could announce QE measures when it meets on Jan. 22, in order to minimise any knock-on effects to European markets from the Greek vote later on Jan. 25.