Venizelos

John Aglionby

Welcome to our rolling coverage of the reaction to elections in France and Greece on a big day for Europe.

By Tom Burgis, John Aglionby and Esther Bintliff in London with contributions from FT correspondents around the world. All times are London time.

This post should update automatically every few minutes, although it might take longer on mobile devices.

16.52 That’s the lot of the live blog today. See FT.com for more news and analysis through the night.

We’ll leave you with a quick summary and some reading. Today:

  • Markets reacted warily at first to the French and Greece results, although equities and bonds recovered through the day. The euro stayed weaker though
  • Angela Merkel promised François Hollande a warm welcome in Berlin but said the eurozone’s fiscal pact was not up for re-negotiation. She also urged Greece to stick to the cuts programme agreed with lenders
  • Greece’s political leaders wrangled over a possible coalition government after voters administered a thumping to the two biggest parties, leading to predictions of a fresh election and a potential move to tinker with the terms of the country’s €174bn bail-out
  • Spain reversed course and said it plans to pump public cash into troubled lender Bankia
  • Leftists from Dublin to Stockholm hailed the victory of a Socialist in France, with many seeking to use Hollande’s triumph to push for more pro-growth policies to temper European austerity

 Read more >>

Welcome back to our continuing coverage of the eurozone crisis.

After more than 13 hours of talks, a second bail-out for Greece was agreed early on Tuesday morning. We’ll be bringing you reaction to the deal throughout the day. All times are GMT. By John Aglionby, Leyla Boulton and Tom Burgis on the news desk in London.

We’re going to wrap up now since, after getting no sleep last night, diplomats and officials across the eurozone appear to be heading home while Athens remains abuzz with how it will meet its side of the second Greek bail-out. To recap today’s highlights:

  • Negotiators for private bondholders have backed the latest Greek deal forcing them to accept a haircut, but avoiding a disorderly default next month.
  • While the euro rallied, European equities closed down as the deal left investors unimpressed while US stocks neared a post-financial crisis high, driven by psychological thresholds .
  • Evangelos Venizelos, Greek finance minister, told an Athens press conference that the official offer on the bond swap would be made to bond holders by the end of this week. A government official added that the collective action clause, forcing holdout investors to participate, would be approved by parliament on Thursday.
  • Reaction on the streets of Athens was muted, with leftwing parties saying the deal was bound to make the recession worse. Aleka Paparriga, Greek Communist party leader, said “it’s not impossible that this crisis will turn into a disorderly default within months”.
  • Lucas Papademos, prime minister, convened a cabinet meeting to put the finishing touches to a pile of legislation that must pass in parliament by the end of February – if Greece’s credibility is to be maintained at the March 2 summit of European leaders, the next stage towards getting funding from the bailout agreed overnight.
  • Greek government officials confirmed that the country will hold a general election at the end of April or the beginning of May.

 Read more >>

Photo: Getty

Welcome back to our continuing coverage of the eurozone crisis.

By Esther Bintliff and John Aglionby in London and Anjli Raval in New York, with contributions from correspondents around the world. All times GMT.

It was decision day on the Greek bail-out. After so many twists to this saga here is a round-up of what came out of the meeting of eurozone finance ministers after more than 13 hours of talks, courtesy of Peter Spiegel and Alex Barker of the FT’s Brussels bureau.

  • A long-delayed €130bn second bail-out for Greece was agreed on.
  • Further “haircuts” were pushed for after a confidential debt analysis showed that the previously-negotiated deal would cost €136bn and would only lower Greek debt to 129 per cent, rather than 120 per cent, of economic output by 2020.
  • Although Greek bondholders agreed in October to accept a 50 per cent cut in the face value of their bonds, they will now be offered a “voluntary” deal with a haircut of 53.5 per cent.
  • That will get Greek debt levels to 120.5 per cent by 2020, close to the IMF’s goal for long-term debt sustainability.
  • The euro rose 0.8 per cent to 1.3257 on the news, before falling back to 1.3263 at 4.20 GMT.

 Read more >>