European stocks rise on Greek aid talk

By Grace Wong, contributing writer


LONDON (CNNMoney.com) -- European shares held gains early Friday following news that Greece may soon be getting the aid it so desperately needs.

In morning trading, Britain's FTSE 100 added 0.77%. The CAC 40 in France gained 0.42% and Germany's DAX jumped 1.2%. Markets had been slightly higher ahead of the news from Greece, lifted by encouraging economic news from Germany.

A report showing the business climate in Germany improving for a second month in a row lifted sentiment in the region.

The upbeat reading of the Ifo Business Climate survey in April helped offset earlier concerns about Greece's debt burden.

Early Friday, Greek Prime Minister George Papandreou formally asked for the activiation of the European Union/International Monetary Fund loan package.

Fears that Greece would miss its May 19 deadline for refinancing €8.5, or about $11.4 billion in debt, grew Thursday after Moody's cut its bond rating on Greece and a separate report showed that Greece's deficit may be worse than previously estimated.

The move sent Greek bond prices in a tailspin, raising the yield on the country's benchmark 10-year bond to a record of 8.8%. Bond prices and yields move in opposite directions. The yield on the Greek 10-year bond edged off its record highs following the news, dipping to 8.02%.

Worries that Greece might default on its debt have weighed on global markets in recent months. Investors fear that if that happens, Greece will be forced to seek a bailout.

Asian stocks fell back Friday. Hong Kong's Hang Seng index dropped nearly 1%. Japan's Nikkei ended the session 0.3% lower and the Shanghai Composite fell 0.5%.

U.S. stocks tumbled Thursday after Moody's downgraded Greece's bond rating but staged a comeback in the afternoon and managed to finish the session with slim gains. To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Overnight Avg Rate Latest Change Last Week
30 yr fixed3.89%3.92%
15 yr fixed3.05%3.06%
5/1 ARM3.12%3.19%
30 yr refi3.95%3.97%
15 yr refi3.10%3.14%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Index Last Change % Change
Dow 18,285.74 0.34 0.00%
Nasdaq 5,090.79 19.05 0.38%
S&P 500 2,130.82 4.97 0.23%
Treasuries 2.18 -0.07 -2.93%
Data as of 5:15am ET
Company Price Change % Change
Bank of America Corp... 16.73 -0.01 -0.06%
AT&T Inc 35.07 0.45 1.30%
General Electric Co 27.72 0.08 0.29%
Apple Inc 131.39 1.33 1.02%
Yahoo! Inc 43.68 0.88 2.07%
Data as of May 21

Sections

Building the replacements for tens of millions defective airbags and finding owners of the recalled cars will be a difficult and time-consuming process. More

Chelsea Clinton took the stage during Internet Week New York to discuss a new report that looks at the state of women around the world. More

Google apologized for and fixed Google Maps issue where users were taken to the White House if they type in variations of the n-word. More

For $2,000 a month, Beacon will offer unlimited flights between New York and Boston -- and plans to add more cities soon. More

Rents increased 4% in April from last year while home values only rose 3% during the same time period. More