ROME: European stocks closed at their highest level in more than seven years. Greek shares fell amid concern over talks between the nation’s government and European leaders.
The Stoxx Europe 600 Index added 0.1 percent to 372.51 at the close of trading, erasing intraday losses of as much as 0.6 percent as energy shares advanced. The ECB restricted loans to Greece, a decision that will raise financing costs for the nation’s banks and increase oversight by policy makers. The Greek ASE Index slid 3.4 percent as lenders slumped.
Following the ECB’s move, the government in Athens held onto demands to end austerity. German Finance Minister said after a meeting with his Greek counterpart that they “agreed to disagree,” signaling no compromise. Optimism that Greece’s new government will soften its anti-austerity stance had sent the Stoxx 600 higher earlier this week, with the ASE posting its biggest three-day rally since 1991.
“The consequences of the current turmoil in Greece are extremely important,” said Pierre Mouton, who helps oversee $8 billion at Notz, Stucki & Cie. in Geneva. “Greece puts itself at the extreme of the spectrum, while the ECB stands at the opposite. Now it’s bargaining time and they should get closer as time goes by.”
The Stoxx 600 has surged 8.8 percent this year after the ECB announced a bond-buying plan that included sovereign bonds. The volume of Stoxx 600 shares changing hands was 5.3 percent greater than the 30-day average, data compiled by Bloomberg show.
