Sentiment rests on loan talk, debt sale

As Finance Minister Giorgos Papaconstantinou meets with his European peers in Luxemburg today and tomorrow, investors will be watching out for any news on the EU and International Monetary Fund providing Greece with more time to pay back its loans. A loosening of the time schedule on the 110-billion-euro debt would push the Athens bourse onto a sustainable upward course, according to brokers, giving the country more time to get a grip on its public debt and avoid the possibility of bankruptcy after the loan period ends in 2012. Last week, the Athens bourse benchmark general index added 1.40 percent, ending at 1,549.94 points, after sentiment was boosted by news that National Bank’s 1.8-billion-euro rights issue and bond offering was met with strong demand. Investors will also be keeping an eye out this week for results from tomorrow’s 13-week treasury bill auction, in which the Public Debt Management Agency plans to raise 900 million euros. With the spread on 10-year Greek bonds over German Bunds narrowing recently, the yield to be offered on the 13-week T-bill auction is expected to be lower than the previous auction held in July.

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