Europe’s main stock markets rose yesterday as investors awaited further crucial developments on the Greek debt crisis this week. During late morning trade, London’s benchmark FTSE 100 index won 0.49 percent to 5,432.71 points, Frankfurt’s DAX 30 rose 0.34 percent to 5,733.21 points and in Paris the CAC 40 added 0.42 percent to 3,785.05.
The Euro Stoxx 50 index of top eurozone shares increased by 0.19 percent in value to reach 2,778.15 points.
Greece’s deficit is more than four times the allowed EU limit, at an estimated 12.7 percent of gross domestic product.
In foreign exchange trade, the euro slumped against the dollar to strike the lowest point since May, as the shared eurozone currency was plagued by those concerns.
The European single currency tumbled to 1.3436 dollars, reaching a level last seen on May 18, 2009.
Under pressure from Brussels, Greece’s crisis-hit Socialist government is expected this week to announce new measures to limit spending before Prime Minister George Papandreou flies to Berlin for talks with Chancellor Angela Merkel on Friday.
The European Union urged Greece on Monday to act fast with new steps to tackle its deficit as markets monitored conflicting signals about a financial rescue and fresh evidence of eurozone budget strains.
Following a flurry of high-level meetings in Athens, EU Economic and Monetary Affairs Commissioner Olli Rehn said the measures were “essential to regain credibility and confidence (among) European partners and market forces.”
The problem is particularly acute as Greece is planning to sell up to €5 billion of 10-year bonds this week in an issue which had to be delayed from last week because of financial market turbulence.
The government must also redeem old debt totalling about €20 billion in April and May and needs quickly to continue raising a total of about €55 billion to cover its public deficit this year.
Elsewhere yesterday, a strong showing on Wall Street helped Asian shares move broadly higher as technology stocks gained across the region and Australian investors reacted to a rate rise by the central bank.
However, cautious profit taking saw Chinese stocks lose ground as dealers eyed the start of annual parliament sessions at the end of the week and the economic policies it could generate.
Shanghai closed down 0.48 per cent, led by profit-taking in miners as copper supply concerns following the massive 8.8 magnitude earthquake in Chile eased, dealers said.
Hong Kong fell 0.72 per cent, with shares in banking giant HSBC down 7.0 per cent after 2009 results fell short of expectations.
