Wall Street Journal
May 31, 2011
European stock markets closed sharply higher on hopes that Greece will be able to avoid a restructuring of its debt.
Greek banks surged, while oil stocks like Total gained as the euro rose and the dollar fell. Shares of mobile-phone giant Nokia, which warned investors that it might not book a profit in its core business this quarter, sank nearly 18%. The stock was one of the biggest decliners on the Stoxx Europe 600 index.
The Stoxx 600 closed up 0.8% to 281.06.
Germany may abandon a push to reschedule Greek debt early, which would allow for fresh aid for Greece. The euro rallied on the news, helping oil to rise.
The Greece ASE Composite index soared 5.6%. Shares of Eurobank Ergasias and National Bank of Greece were up around 11%, while Alpha Bank was up 8.6%.
"Greece and its ability to find yet another accommodation with its many creditors will continue to set the tone for Europe," said Stephen Pope, managing partner of Spotlight Ideas. "Naturally any suggestion that obligations will be honored, even if later as against sooner, will deliver a benefit for the affected parties, namely the euro and exposed banks."
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