European stock markets came back to life as news from Athens renewed Greece creditors’ hopes. On Monday, the Prime Minister Alexis Tsipras promised during an emergency meeting with E.U.’s top representatives that his office was working towards reaching a deal that would prevent the country’s exit from the eurozone and a painful default.
And European investors’ newly-found optimism didn’t fade away when the European Commission head Jean-Claude Juncker disclosed that the agreement designed to pump vital money into the country to dodge default was “not yet there.”
As of Monday, the German stock index DAX 30 jumped 3.14 percent to 11,386.84, while the benchmark French stock market index CAC 40 soared 3.04 percent to 4,961.92 points.
In Spain, the country’s benchmark stock index IBEX gained 2.60 percent to 11,228.40 points, while the Greek benchmark index skyrocketed 7.64 percent in only one day.
On the other hand, England’s major stock market index FTSE 100 saw only a 1.27 percent uptick to 6,795.98.
Analysts believe that the positive figures show that European stock markets are confident that the Greek tragedy may soon reach its final act with a deal over bailout repayments being reached.
On Monday, the euro fell from its Friday level to $1.1338 as the European Central Bank (ECB) boosted emergency liquidity funds aimed at keeping Greek banks on life support until a final deal is closed.
The ECB representatives said that they would repeat the move at “any time” in case of emergency.
The ECB hikes Emergency Liquidity Assistance for the third time in a row since June 17 since Greek banks’ deposits near a liquidity crisis as savers keep withdrawing money in large amounts.
“Behind the scenes, the European Central Bank remains active in keeping Greek banks on life support,”
concluded Alistair Cotton, senior analyst at Currencies Direct.
On the other hand, France seemed content with the progress Greece has made in the last couple of weeks. The French Minister of Finance deemed Greek efforts “quality work” in a recent radio interview.
Additionally, the President of the European Commission Jean-Claude Junker said that the Greek proposals to exit the debt crisis exposed in a phone call by the country’s prime minister provided a “good basis for progress.”
But if the deal falls, Greece would enter default by June 30, when it has the final deadline of repaying IMF a debt of about $1.68 billion. And analysts think that the scenario may destabilize or even crash out the entire eurozone.
Image Source: Irish Times
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