LONDON — Europe’s stock markets closed on a high Friday, ahead of Sunday’s summit of European Union leaders that will decide the future of Greece in the euro zone.
Greek parliamentarians were set to vote Friday evening on a stack of proposals aimed at cutting costs, reducing debt, and showing the country’s European Union partners that Greece still belongs in the euro zone. Crucially, the debt-laden country is also asking its EU partners for a third bailout as the country’s banks remain shut.
Greek Prime Minister Alexis Tsipras’ latest package of reforms, however, has already come under fire in the press for being strikingly similar to those proposed by the country’s creditors — the same ones that were rejected by the Greek people in a referendum last Sunday.
Markets, however, are clearly optimistic that the EU will accept the reforms, hand Greece its bailout, and allow the country to remain in the euro zone.
The CAC 40 in Paris closed up 3.1 percent to 4,903.07, followed by the FTSE MIB in Milan, 3 percent to 22,937.40, and the DAX in Frankfurt, 2.9 percent to 11,315.63. The FTSE 100 in London was up 1.4 percent to 6,673.38.
The euro traded at $1.11, while the pound fetched $1.54 against the dollar, and the Swiss franc, $1.06 at the close of trading.
The vast majority of retail and luxury stocks were up, with the exception of Mulberry Group, which fell 0.5 percent to 9 pounds, and Brunello Cucinelli, 0.2 percent to 16.37 euros.
Among the stocks that gained the most were Inditex, 6.6 percent to 29.68 euros; Kering, 2.6 percent to 163 euros; Hugo Boss, 2.5 percent to 102.59 euros; Beiersdorf, 3 percent to 77.36 euros; Marks & Spencer Group, 3.4 percent to 5.38 pounds; Tod’s, 3.7 percent to 82.05 euros; and Unilever, 3.4 percent to 39.49 euros.
According to the BBC, the new proposals include pension reforms; a tax rise on shipping companies; setting VAT at a standard 23 percent; 300 million euros worth of defense spending cuts by next year; the privatization of ports; and canceling the 30 percent tax break for the country’s wealthiest islands.
On Friday, the BBC quoted Italian Prime Minister Matteo Renzi as saying he was “optimistic and hoped a deal could be struck on Saturday,” so that the Sunday meetings would not be needed.
It also reported that French President François Hollande as saying the new proposals were “serious and credible” and that the “Greeks have just shown their determination to remain in the euro zone.”