Saturday 21 February 2015

Greece gets deal, markets rally

Eurozone finance ministers reached an accord on Friday to keep funds flowing to Greece. Bloomberg reports:

Talks in Brussels between officials from the 19 euro-area finance officials concluded Friday evening with an agreement to extend aid to Greece for four months.

“We agreed on four months under conditions,” Austrian Finance Minister Hans Joerg Schelling told reporters after the meeting. Greece must submit a list on Monday of measures it will undertake in return and “the institutions check whether the list is sufficient,” he said.

Markets rallied on the news. The S&P 500 rose 0.6 percent to a record high, reversing an earlier drop of 0.6 percent. Futures on the Euro Stoxx 50 rose after the STOXX Europe 600 had closed at a seven-year high earlier during trading. The euro rose 0.1 percent versus the US dollar.

While one European crisis is relieved, even if only temporarily, another crisis continues to simmer.

On Friday, Moody’s Investors Service cut Russia’s credit rating one level to Ba1, below investment grade, as the conflict in Ukraine and plunging oil prices curb growth and erode financial stability. Moody’s also has a negative rating outlook on the country.

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