Markets subdued as investors await Greek debt deal

LONDON—Markets were cautious yesterday as investors waited for Greek political leaders to endorse an austerity plan that would allow the country to claim its second bailout. Stocks lost most of their earlier gains, while the euro came off two-month highs, as investors monitored news out of Athens. Though a host of deadlines have passed without agreement, the prevailing view in the markets is that a deal for Greece to get its hands on €130 billion (US$170 billion) will be secured. In Europe, the FTSE 100 index of leading British shares closed 0.2 per cent lower at 5,875.93 while Germany’s DAX fell 0.1 per cent to 6,748.76. The CAC-40 in France also ended 0.1 per cent lower, at 3,410. All three had been slightly higher in the morning. The euro was trading 0.2 per cent lower at US$1.3239, having earlier hit a two-month high of US$1.3289.

In the US, the Dow Jones industrial average was down 0.4 per cent at 12,822.65 while the broader Standard & Poor’s 500 index slipped by the same percentage to 1,342.31. Earlier in the day, Asian stocks posted sharp gains following a retreat of the yen that was welcomed by Japan’s mighty export sector. The Nikkei 225 index in Tokyo gained 1.1 per cent to close at 9,015.59, its highest finish since October 28. Hong Kong’s Hang Seng surged 1.5 per cent to 21,018.46 while mainland China’s Shanghai Composite Index jumped 2.4 per cent to 2,347.53 and the smaller Shenzhen Composite Index gained 2.8 per cent to 893.82.

AP