World stocks rise after Greece deal

World stock markets rose today after talks over Greece’s financial crisis ended with an agreement on how to reduce its debt load.

World stocks rise after Greece deal

World stock markets rose today after talks over Greece’s financial crisis ended with an agreement on how to reduce its debt load.

The agreement paved the way for the cash-strapped country to receive the next instalment of a bailout loan.

Finance ministers of the 17 countries that use the euro and representatives of the International Monetary Fund (IMF) reached an agreement early today that will enable Athens to receive €44bn immediately and three additional payments early next year.

Dickie Wong, executive director of research at Kingston Securities in Hong Kong, said: “This is quite positive. It definitely gives support to the local stock market.”

In early European trade, Britain’s FTSE 100 rose 0.5% to 5,816.49. Germany’s DAX added 0.6% to 7,334.24 and France’s CAC-40 gained 0.6% to 3,522.04.

On Wall Street, Dow Jones industrial futures rose 0.1% to 12,949. S&P 500 futures advanced 0.1% to 1,405.20.

Greece has endured five years of recession and a 25% unemployment rate. It has been locked out of the international long-term debt market by exceptionally high interest rates demanded for its bonds since 2010, and has been relying on funds from rescue loans by other euro countries and the IMF.

Asian markets also posted gains. Japan’s Nikkei 225 index rose 0.4% to close at a seven-month high of 9,423.30. South Korea’s Kospi rose 0.9% to 1,925.20. Australia’s S&P/ASX 200 gained 0.7% to 4,456.80.

Benchmarks in Taiwan, Singapore, Thailand and the Philippines also rose. Indonesia and New Zealand fell.

Hong Kong’s Hang Seng lost 0.1% to 21,844.03. In mainland China, the Shanghai Composite Index fell 1.3% 1,991.16, its lowest close in nearly four years.

On January 23 2009, the index closed at 1,990.66. The smaller Shenzhen Composite Index plummeted 3% to 765.52.

Mr Wong said investors are taking a “wait and see” stance ahead of the national economic work conference early next month, a forum for leaders involved in economic policy.

“Before this meeting, the sentiment of the Chinese stock market will remain sluggish,” he said.

Zhang Yang, analyst at Sinolink Securities in Shanghai, said investors are disappointed that authorities have not taken new action to help the economy following the Communist Party congress earlier this month.

“It was panic selling,” Mr Zhang said. “I think there still exists room for more losses.”

Benchmark oil for January delivery was up 24 cents to $87.98 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 54 cents to close at $87.74 on the Nymex yesterday.

In currencies, the euro rose to $1.2975 from $1.2963 late yesterday in New York. The dollar rose to 82.20 yen from 82.18 yen.

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