ROME: European stocks surged Friday after new Greek proposals for policy overhauls and budget cuts appeared closer to creditors’ demands, fueling investor hopes the country can strike a deal to keep it in the eurozone.
Eurozone decision makers are set to assess the plan, submitted Thursday night, during crisis meetings on Saturday and Sunday.
The Stoxx Europe 600 was 1.6 per cent higher in early trade, building on Thursday’s rally as investors sensed a further thawing in the impasse in Greece’s debt negotiations.
“Hope has broken out overnight. Although the midnight deadline was tested, the Greek proposals are in, with the creditors and show some meaningful concessions,” said Deutsche Bank strategist Jim Reid.
Stock markets in Germany, France, Italy and Spain all climbed by more than 2 per cent. The Stoxx Europe 600 has now clawed back all of the losses made after Sunday’s referendum, which saw Greek voters reject a set of creditors’ austerity demands.
The relief was also felt in bond markets. German debt, seen as a haven by investors, fell. German 10-year yields rose 0.08 percentage point to 0.81 per cent. Yields rise as prices fall.
