Greek crisis: Athens stocks bounce as Greece outlines offer and Dijsselbloem calls new reform proposals a welcome step in a positive direction
Stocks in Athens were nine per cent higher in the late afternoon, despite the fact Eurozone finance ministers failed to reach an agreement on Greece. A Euro summit meeting was too late to find a deal, but hope not lost.
Greece has apparently ceded ground on several of the main sticking points that had prevented it reaching an agreement with its creditors, including on pension reform. In an interview with the BBC, Greece's economy minister Giorgos Stathakis said Athens would impose a new tax on business, a new tax on the wealthy, and increase VAT on selected items. There were also separate rumours of a proposal to raise the retirement age.
Stathakis said the proposals would be a way of putting the burden on wealthier members of society. He said his government would not be cutting pensions further, but had offered alternative concessions instead.
Read more: The EU is dead – the Greek crisis has laid bare Europe's inability to rescue itself
The FTSE 100 was up 1.4 per cent, while Germany's Dax and France's Cac 40 were both up 3.5 per cent in the afternoon.
The bounce came after comments by Eurogroup President Jeroen Dijsselbloem, who said although there had been no agreement between Greece and its lenders today, new proposals by the country are a good "basis" on which to restart talks.
At a press conference following "last-minute" negotiations between Eurozone finance ministers, Dijsselbloem said there was an "opportunity" for Greece to reach a deal with lenders to unlock its next tranche of bailout money later this week, "and that is what we will work for".
"Work still needs to be done," added Pierre Moscovici, the EU's economic and financial affairs commissioner.
Greece submitted new proposals in advance of today's talks. Reuters reported this morning that included in the document were an offer for Greece to raise its retirement age to 67 and hike VAT. The two subjects have been major sticking points in negotiations between the troubled country and its creditors.
However, negotiations have also been held up over Greece's insistence that its primary budget surplus target should be significantly below the one per cent set by its lenders.
Previous proposals by Greece have insisted the target should be set at 0.75 per cent.
Elsewhere, the European Central Bank (ECB) has raised the limit on emergency loans available to Greek lenders again, after it became increasingly concerned about capital flight from banks.
The ECB's hiked the ceiling on its Emergency Liquidity Assistance (ELA) to €85.9bn (£61.4bn) on Friday, and again today – although there is no information about where the figure stood this morning.
The news comes after estimates suggested some €4.2bn were withdrawn from Greek banks last week. On Sunday, Reuters reported Bank of Greece governor Yannis Sournaras had warned of a "difficult day" on Tuesday if the Greek government cannot reach a deal with its creditors at an emergency summit today.
One banker said "technical issues relating to ATM machines" had been discussed, suggesting there were fears there could be a stampede to withdraw cash if negotiations fail to reach a deal.