Eurozone leaders reached an agreement in Brussels after an all-night negotiation to establish preconditions for a new financial aid programme for Greece.
The struggling southern European country is now scheduled to get between €82 and €86 billion over the next three years. However the Greek parliament must agree to the programme by July 15th with the Bundestag (German parliament) also then voting on the terms and conditions.
EU leaders appeared optimistic on Monday morning with German Chancellor Angela Merkel even going as far as saying “I believe Greece can get back to normal”.
Reacting to criticism that Greece was being asked to give up its sovereignty, Greek Prime Minister Alexis Tsipras told reporters in Brussels: “We have taken the responsibility for this position so as to avoid the most extreme consequences…We are leaving a legacy for the necessary changes in all of Europe, and we will fight to find our way back to growth and win back our lost national sovereignty.”
News of the deal appeared to calm stock markets across Europe which have been experiencing jitters as a result of the Greece crisis.
The Stockholm Stock Exchange (OMX) had a positive start, up by 1.0 percent, having dipped a week ago after a majority of Greek voters rejected the eurozone’s original terms for the country keeping the single currency.
Meanwhile in Denmark, the C20 Cap Index was up 1.3 percent in morning's first 15 minutes of trading, following uncertainty in recent weeks.
The benchmark index on the Oslo Stock Exchange jumped 0.69 percent on market opening, and had climbed to further to 0.83 percent up by 11am.
Markets in Stockholm, Oslo and Copenhagen rose on Monday morning. File photo: TT
Speaking just ahead of the deal's announcement, Eva Trouin, Sweden Manager of Scandinavian online broker Nordnet, told Nordic newswire TT that every twist and turn in the Greece crisis had been affecting markets in the region, despite their relatively small size.
“Everything that happens makes stock markets nervous, because a Grexit would have an impact on the whole of Europe,” she said.
Neither Sweden, Norway or Denmark are in the eurozone and on Sunday night Sweden's Finance Minister Magdalena Andersson – who previously campaigned for the single currency ahead of a national referendum in 2003 – told Sveriges Radio that the Greece crisis had exposed flaws in the model.
“I myself argued that we should be in the euro, I thought then that the benefits would outweigh [the negatives],” she said, before adding that having a “fairly large currency area” including a number of economies that “look very different” had clearly caused problems.
Reacting to news of the Brussels deal on Monday, Robert Bergqvist, Chief Economist at one of Scandinavia's largest banks, SEB, said that he felt Greece was over the worst of its problems but still had a long way to climb.
“There are huge question marks about the whole euro area. Should a country be able to leave?” he told TT.
He added that he felt the EU had been “shaken…almost in an existential way” by the crisis in Greece.
Andreas Hatzgeorgiou, chief economist at the Stockholm Chamber of Commerce and Greece expert, added: “You should not think that this spells the end of the Greek crisis. It is the end of the most acute phase.”