ECONOMY

Greek markets rally as reform promise builds hope of debt deal

Greek bond yields fell and stocks rose on Tuesday after Athens said it would present urgently needed economic reforms to its euro zone partners by next Monday.

Greece will present the list in hope of unlocking aid to help it deal with a cash crunch and avoid default. German officials said talks on Monday helped to clear the air between Greece and Germany, whose governments have been at an impasse over a deal.

Greek two-year yields fell 144 basis points to 20.44 percent, with 10-year yields down 43 bps at 11.14 percent. .

“The markets have given the Greek authorities the benefit of the doubt,” said Nick Stamenkovic, a bond strategist at RIA Capital Markets.

“There is increased optimism that Greece will be able to deliver reforms sufficient for the rest of the euro area to release the funds needed to cover their short-term financing costs.”

Greece’s top Athex index was up 3.5 percent by 1332 GMT, near session highs. Bank stocks, down over 50 percent since last October, edged just 0.2 percent higher.

[Reuters]