EUROZONE-GREECE/MARKETS REAX BRITAIN Europe gives tired cheer as Greek talks reach deal

Record ID: 147237

  • Title: EUROZONE-GREECE/MARKETS REAX BRITAIN Europe gives tired cheer as Greek talks reach deal
  • Date: 13th July 2015
  • Summary: LONDON, ENGLAND, UNITED KINGDOM (JULY 13, 2015) (REUTERS) VARIOUS OF TRADING FLOOR AT BGC PARTNERS BGC PARTNERS, MARKET ANALYST, MIKE INGRAM, TALKING WITH TRADER (SOUNDBITE) (English) BGC PARTNERS, MARKET ANALYST, MIKE INGRAM, SAYING: ''Markets looked like they were going to open down. Futures and euro stocks one percent down also. The announcement of a deal done from the
  • Embargoed: 28th July 2015 13:00
  • Keywords:
  • Location: United Kingdom
  • Country: United Kingdom
  • Topics: General
  • Reuters ID: LVA52NQOEUDW5PUFBE1E18TYD0BF
  • Aspect Ratio: 16:9
  • Story Text: European markets gave a weary cheer on Monday (July 13) as eurozone leaders emerged from-all night talks in Brussels with a deal to keep Greece afloat and part of the euro currency union.
    European Council President Donald Tusk announced just as trading started for the week that after months of tortuous negotiations, marathon overnight talks had achieved a third bailout for Greece.
    "Euro summit has unanimously reached agreement. All ready to go for ESM programme for Greece with serious reforms and financial support," Tusk tweeted, referring to the European Stability Mechanism bailout fund.
    The euro rose initially against the world's other major currencies but dropped back as traders locked in some the profits of recent days.
    Capital controls imposed by Athens have limited trading in Greek bonds, but Tradeweb data showed two-year yields down 4.81 percentage points.
    Mike Ingram, market analyst at BGC Partners said that there was a feeling of relief across the markets that a Greece exit from the single currency bloc had been averted.
    ''Markets looked like they were going to open down. Futures and euro stocks one percent down also. The announcement of a deal done from the euro group immediately changed that and we flipped into one percent, one and a half percent positive. Positive move on the euro. We've seen periphery debt in Europe rally, as well, so it looks like we have declared victory and decided that everything is hunky-dory in Euroland,'' he said.
    If the summit had failed, Greece would have been staring into an economic abyss with its shuttered banks on the brink of collapse. It also faced the prospect of having to print a parallel currency and in time, exit the European monetary union.
    Greece won conditional agreement to receive a possible 86 billion euros ($95 billion) over three years, along with an assurance that eurozone finance ministers would start within hours discussing ways to bridge a funding gap until a bailout - subject to parliamentary approvals - is finally ready.
    That will only happen if he can meet a tight timetable for enacting unpopular reforms of value added tax, pensions, quasi-automatic budget cuts if Greece misses fiscal targets, new bankruptcy rules and an EU banking law that could be used to make big depositors take losses.
    Ingram said the future did not look very bright for Greece.
    ''From this starting point with yet more debt, no debt relief, more austerity, Greece is going to remain in a depression-like state for the forseeable future. Again, the debt dynamics, absent of any kind of restructuring or haircut, which doesn't seem to be on the table, certainly not imminently. We are going to be back here again and I think we will be back here again in 2016,'' he said.
    The Greek parliament will vote on whether to accept the terms of the bailout by Wednesday.
  • Copyright Holder: REUTERS
  • Copyright Notice: (c) Copyright Thomson Reuters 2015. Open For Restrictions - http://about.reuters.com/fulllegal.asp
  • Usage Terms/Restrictions: None
Register