European Markets Extended Recent Gains On Greek Optimism

(RTTNews) - The European markets ended Friday's session firmly in positive territory, adding to the gains of the previous two trading sessions. Investors remain optimistic that a solution to the Greek debt crisis is in sight. The continued recovery of the Chinese stock market and the positive performance of the U.S. equity markets also added to the positive mood among investors.

Greek Prime Minister Alexis Tsipras submitted a cash-for-reforms proposal to creditors on Thursday that includes spending cuts, pension reforms and tax hikes in exchange for a 53.5 billion euro three-year bailout, a third for the country, acceptance of which will pave the way for further negotiations between both sides.

The Greek Parliament is set to discuss the proposal Friday evening and the vote outcome is expected early Saturday.

Eurozone finance ministers are scheduled meet on Saturday at 3 pm local time in Brussels to review the Greek request.

French President Francois Hollande described the Greek proposal as "serious, credible" in a Twitter post on Friday. The proposal showed "a determination to remain in the euro area," he added.

Italian Prime Minister Matteo Renzi said he was more optimistic than before that an agreement will be struck between Greece and its creditors.

Meanwhile, Germany has been less upbeat regarding the new proposal, thanks to the Greek referendum that rejected austerity measures, and their stiff opposition to any debt relief for Greece. Some other eurozone members are also likely to oppose any debt write down for Greece.

German Chancellor Angela Merkel has been silent on Friday regarding the new proposal.

The Euro Stoxx 50 index of eurozone bluechip stocks increased by 3.39 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, added 2.11 percent.

The DAX of Germany climbed by 2.90 percent and the CAC 40 of France rose by 3.07 percent. The FTSE of the U.K. gained 1.39 percent and the SMI of Switzerland finished higher by 1.66 percent.

In Frankfurt, Deutsche Bank increased by 4.30 percent and Commerzbank gained 2.48 percent.

Deutsche Telekom advanced by 5.13 percent and Deutsche Lufthansa climbed by 3.63 percent.

BASF rose by 4.26 percent and K+S finished higher by 3.79 percent.

In Paris, BNP Paribas gained 4.03 percent and Societe Generale added 3.65 percent. Credit Agricole also finished higher by 3.11 percent.

Orange surged by 4.91 percent and Alcatel-Lucent rose by 2.52 percent.

In London, Inter Continental Hotels rose by 3.07 percent. The company has agreed to sell its ownership interest in InterContinental Hong Kong for $938 million.

Smith & Nephew gained 0.90 percent, after it acquired the trauma and orthopaedics business of DeOst LLC and DC LLC.

Ryanair increased by 2.23 percent. The company's Board has voted unanimously to accept the IAG offer for Ryanair's 29.8% shareholding in Aer Lingus Group. IAG also finished higher by 3.21 percent.

Barclays climbed by 2.64 percent and Lloyds Banking Group added 0.92 percent. Standard Chartered gained 1.49 percent and Royal Bank of Scotland increased by 0.58 percent.

Germany wholesale prices continued to decline in June, figures from Destatis showed Friday. Wholesale prices dropped 0.5 percent year-on-year in June, slightly faster than May's 0.4 percent fall. The wholesale price index has been falling since July 2013.

French industrial output recovered as expected in May, the statistical office Insee reported Friday. Industrial output grew 0.4 percent month-on-month in May, reversing a 0.8 percent fall in April. This was the fastest growth in three months. The monthly rate matched economists' expectations.

Britain's trade deficit in goods in May was the smallest in nearly two years as imports declined and exports remained unchanged, data from the Office for National Statistics showed Friday. The visible trade deficit for May was GBP 8 billion, which was the smallest shortfall since June 2013. It was also smaller than the GBP 9.7 billion deficit predicted by economists.

U.K. construction output declined for the second straight month in May, defying economists' expectations for an increase, data from the Office for National Statistics showed Friday. Construction output fell 1.3 percent month-over-month in May, faster than previous month's 0.5 percent drop. Economists had expected a 0.8 percent climb for the month.

Wholesale inventories in the U.S. increased by much more than expected in the month of May, according to a report released by the Commerce Department on Friday. The report said wholesale inventories increased by 0.8 percent in May after rising by 0.4 percent in April. Economists had expected inventories to rise by 0.3 percent.