European Stocks Rise Further on Hopes of Greek Deal

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The FINANCIAL — European stocks rose on June 23, with investors betting Greece is closing in on a deal with its creditors, according to Nasdaq.

The Stoxx Europe 600 was 0.9% higher in early trade, building on Monday’s 2.3% gain. The sharp rally in European stocks has come after an apparent breakthrough in Greek bailout talks following weeks of deadlock.

Greece’s creditors suggested for the first time that a deal to avert the country’s bankruptcy was in sight after a last-minute proposal submitted by Athens on Monday. Early Tuesday, Pierre Moscovici, European Commissioner for Economic and Financial Affairs, told French radio he expects a deal to be reached this week.

Uncertainty over Greece’s future has put stock markets under pressure in recent weeks. The relief continued to spread on June 23.

Germany’s DAX climbed 0.6% after logging its biggest one-day rise in nearly three years on June 22. France’s CAC 40 was up 0.6%, helped by stronger-than-expected French manufacturing and services data. Figures for the eurozone as a whole are due later Tuesday morning.

Outside the currency bloc, the U.K.’sFTSE 100 rose 0.2%.

Greek debt extended gains. Greece’s two-year bond yield fell around a quarter of a percentage point to 22.6%. Yields fall as prices rise.

Spanish and Italian bond yields also edged lower.

In currency markets, the euro fell 0.7% against the dollar to $1.1268. The common currency has been resilient to the Greek negotiations in recent weeks, rising as stocks fell. Some analysts think a resolution to the Greek deal will see investors re-enter bets on a weaker euro against the buck.

The reaction to the Greek news “highlights that long U.S. dollar trades are favored against a backdrop of improving risk appetite,” said currency strategists at BNP Paribas.


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