Markets react to Greek aid deal

22/07/11 15:47 CET

economy

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In early trading the financial markets signalled their approval on Friday of the new rescue package agreed for Greece.

Shares rose in value across Europe and Athens stock market index shot up, it was close to five percent near the end of the trading day, but by then other European bourses had lost most of their earlier gains.

Greek banks featured among the top performers, along with French banks which have heavy exposure to Greece.

It was the same story in Germany. Stefan Scharffetter from Baader Bank said: “After the rescue package we have seen the DAX start trading well up and we expect to keep seeing positive developments over the next few days.”

Spanish and Italian banks also benefited after Madrid and Rome received assurances of European support for their lenders.

The cost of insuring Greek, Irish and Portuguese government bonds against default tumbled.

On the foreign exchange markets, the euro jumped versus the Swiss franc but was little changed against the dollar.

More about: Economy, European markets, Eurozone in crisis, Greece

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