November 27, 2012 / 3:07 AM / 6 years ago

Greek debt deal sends shares, euro higher

LONDON (Reuters) - The euro rose and European shares climbed to a near three-week high on Tuesday after global lenders clinched a deal to reduce Greek debt and disburse the country’s next aid installment.

People are reflected on an electronic board displaying a graph showing the movement of Nikkei share average outside a brokerage in Tokyo November 7, 2012. REUTERS/Toru Hanai

After 12 hours of talks, the lenders agreed measures to cut Greek debt to 124 percent of gross domestic product by 2020, and promised further steps to lower it below 110 percent in 2022.

European shares on the FTSEeurofirst 300 .FTEU3 opened up 0.5 percent following the deal, with London’s FTSE 100 .FTSE, Paris’s CAC-40 .FCHI and Frankfurt’s DAX .GDAXI between 0.5 and 0.9 percent higher. .L.EU.N

The euro also climbed, gaining as much as 0.3 percent in the Asian session to hit $1.3010, its highest level since October 31, before paring gains to be up 0.1 percent at $1.29940 at 3.10 .m. ET.

“After three meetings this months and a total of more than 24 hours of discussing and negotiating, the euro zone countries have put their money where their mouth is,” said ING economist Carsten Brzeski.

“The political will to reward the Greek austerity and reform measures has already been there for a while. Now, this political will has finally been supplemented by financial support.”

Safe-haven German government bonds fell in reaction to the Greek news, with benchmark Bunds down 40 ticks at 142.00 compared with 142.43 at Monday’s settlement.

In Asian trading, MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS gained 0.7 percent to a near three-week high, led by a 1 percent advance in Korean shares .KS11 and a 0.7 percent rise in Australian shares . Indian shares .BSESN also jumped 1.2 percent.

Shanghai shares .SSEC bucked the trend to fall 1 percent to their lowest since 2009, dragged by weakness in growth-sensitive companies.

U.S. stock futures were up 0.2 percent, hinting at a firm Wall Street open.

A general view of the German stock exchange in Frankfurt November 7, 2012. REUTERS/Lisi Niesner

Editing by Anna Willard

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