World stock markets were propelled higher on Monday morning on relief that pro-bailout parties in Greece had secured a narrow victory in the election re-run over the weekend.
But there was concern that the rally would prove shortlived, amid continued fears that debt-laden Greece will ultimately be forced out of the eurozone.
“The challenges facing the Greek economy remain mountainous and the general feeling remains predominantly that the day of reckoning has merely been delayed,” said Michael Hewson, senior market analyst at CMC Markets UK.
“The outcome of the Greece election could prove to be one of those results that could end up being potentially toxic to the winner, given that the next government could well preside over Greece’s eventual exit from the euro.”
The euro hit a one-month high against the dollar, rising to $1.2748, and European stock markets all moved higher. The FTSE 100 index in London leapt nearly 75 points to 5551, a 1.3% gain, with mining and banking shares the biggest gainers. Spain’s Ibex jumped 1.7% and Italy’s FTSE MiB rose 1%, while Germany’s Dax climbed 1.3% and France’s CAC is 1.1% ahead.
In Asia, Japan’s Nikkei closed 1.8% higher while Hong Kong’s Hang Seng and Singapore’s Straits Times both added about 1%. The leaders of Spain and Italy welcomed the election result.
(source: guardian)
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