Greek Prime Minister will accept bailout terms; Stocks surge

Greek Prime Minister will accept bailout terms; Stocks surge

1 July 2015, 13:18
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European stocks surged Thursday in the wake of a report that Greece’s prime minister is ready to accept bailout terms set forth by creditors to the Hellenic nation.

The Financial Times reported Greek Prime Minister Alexis Tsipras is ready to accept nearly all of the conditions to a new bailout deal its international lenders proposed over the weekend.

The country missed the $1.7 billion payment to the International Monetary Fund.

The European Financial Stability Facility (EFSF) earlier released a statement where it said that the failure to pay will not affect the ability of the eurozone bailout fund (the EFSF) to pay its bondholders. It added that the non-payment could be a default for certain EFSF loans, and it was still analysing the situation.

Following the news, the euro had hit an intraday high of $1.1172, according to FactSet, and has since consolidated at 1.1112.

The Stoxx Europe 600  popped up 1.6% to 387.29, with all sectors advancing.

Germany's DAX 30 added 2% at 11,157.86. France’s CAC 40 rose 2.3% at 4,898.83, and Spain’s IBEX 35 climbed 1.6% to 10,939.60.

In London, the FTSE 100 piled on 1.3% at 6,605.57. U.S. futures also rallied, with futures for the Dow Jones Industrial Average higher by about 1%.

Markets now await the meeting of the Eurogroup of finance ministers due later Wednesday to get any further direction on Greece.

“Otherwise the markets will have to wait until Sunday’s referendum to get further clarity on the matter,” said Boris Schlossberg, managing director of FX strategy, at BK Asset Management.

Greece's stock market is closed for the week, and trading in some Greek government bonds has been halted by Tradeweb.

A day earlier, the Stoxx 600 on Tuesday logged its worst quarterly performance since the second quarter of 2012, largely knocked lower by uncertainty surrounding Greece.

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