Markets surrender early gains after Greek election result

By PETER RANSCOMBE
Published on 18/06/2012 10:16

London’s FTSE 100 index surrendered its early gains following the Greek election result as traders said the hard work was still to come to rescue the eurozone from its debt crisis.

The Footsie had jumped by nearly 1.4 per cent in early trading but had fallen into negative territory by mid morning.

Rebecca O’Keeffe, head of investment at Interactive Investor, said: “Already questions are being asked about how strong this rally really is and whether reality about the hard work that is to come will dampen spirits.”

The result of the Greek poll, which had seen Asian markets rise over night, meant a Greek exit from the euro – a major threat to global financial stability – was no longer an imminent threat. The euro rallied against most major currencies.

But investors remain worried about the future of the single currency and how Europe’s leaders will tackle the on-going debt crisis.