Increase in the market about the Greek aid package

Updated July 22, 2011, at 20: 30 GMT under the terms of the agreement, Greece will have much more time to pay your existing debts, shares have risen after agreement of the euro area to resolve the Greek debt crisis.

United Kingdom markets and French more than won 1% in morning trade, before slipping slightly, with the FTSE 100 index ending of 0.6% and 0.7% higher ACC.

The eurozone leaders agreed a new package worth 109bn euros ($ 155bn,. 3bn ￡ 96).

Private lenders will also be asked to contribute, and as a result, the Fitch Ratings agency said it would consider the possibility of Greece in "restricted by default".

Rate of participation of the main Japan Nikkei had earlier closed 1.2%.

US stocks finished mixed Friday in New York, with the main Dow Jones by 0.3%. However, analysts said Wall Street investors focused more on the debt problems of us.

The euro was on Friday's trading at $1.4369 of $1.4439 immediately after the announcement of agreement on Thursday.

"Unthinkable"

One of the main terms of the new package of the euro area is that it reduces interest rates that Greece and the other two countries that have received the release on bail-outs - Portugal and the Ireland Republic - have to pay.

United Kingdom announced on Friday that would follow suit and reduce the rate of interest that the Republic of Ireland has to pay the loan of. 2bn ￡ 3 gave the Irish Government last year.

Speaking on Friday, German Chancellor Angela Merkel welcomed the agreement of the euro area and said that it was the duty of his country to support the single European currency.

"Is our historic duty to support the euro," said Angela Merkel.

"The euro is good for us, the euro is part of the economic success of Germany and a Europe without the euro is unthinkable."

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remains an open question whether countries - Germany especially - will be one day reach a point where cannot be credible that is needed to save the euro "

end quote editor Stephanie Flanders economy, relief of BBC News in the displacement of agreement any concerns about banks, thus losing the scheduled debt restructuring."

"The agreement eliminates one of the concerns relating to the general market... and the EU finance ministers understand the risk associated with a possible defect and that they are willing to strengthen and support the weaker countries," said Robert Pavlik, strategist of Banyan Partners in Florida.

Bond yields, reflecting that the investor's risk attached to the Government's debt, fell in the morning euro zone particularly Greece and Portugal trading. However, yields, then rose again in the afternoon.

Minister of finance Evangelos Venizelos of the Greece said that the agreement will provide "a great relief for the Greek economy".

Measures of the package

The agreement of the euro area is a complete package designed not only to resolve the debt crisis of the Greece but to prevent the spread to other European economies, thereby shoring up the euro in the process of.

Many people feel sometimes even harder to go

The package includes:

109bn euros in loans to GreeceVarious options to extend the deadlines for repayment of Greece and reduce the amount of agreement on the participation of the private sector loansVoluntary existing in these options, so that banks share contributors burdenDoubling the length of repayment for the Republic of Ireland and Portugal, which have received financial assistance previouslyAdditional powers granted to the European instrument for financial stability to buy bonds and to dispose of credit for countries such as Spain and Italy you are not at immediate risk of insolvency.

The Institute of Finance International (IIF) - a body of global trade representing big banks and other major lenders - would be the planned debt restructuring target participation in 90% of Greece's private sector lenders.

Continue reading the main story Greece 142.8%Italy 119 Belgium % 93% 96.2%Portugal 96.8%Ireland Germany 83.2%France 81.7%Spain 60.1%

Source: Eurostat. Public debt expressed as a percentage of economic output.

French President Nicolas Sarkozy said private lenders would contribute to a total of 135bn financing to Greece euros.

This should provide some EUR relief of the debt to Greece.

Three of the four options offered by lenders to Exchange or relend existing debts extending repayment period Greece for 30 years, while the fourth do so for 15 years.

All of them offer an interest rate much lower than the cost of 15% and 25% Greece of loans in the financial markets today.

Two of the options would also mean "haircuts" - reduce the amount of debt Greece have to repay.

The terms of the agreement involve a loss for lenders Greece, equivalent to 21 per cent of the market value of their debts, said the IIF.

But because contributions are expressly "voluntary", the International Swaps and Derivatives Association said that the agreement must not activate payments in default-swaps designed to protect against a default value.

"Right signal"

Fitch Ratings agency said it would consider the possibility of Greece to have default on their debt once bonds old had been exchanged for new bonds.

Although the Agency welcomed the agreement as a positive step, he said it would have no choice but to declare a default value when the Exchange was made.

"The Exchange offers new securities with terms that are worse than the original contractual terms of the existing debt, and where the sovereign is subject to financial constraints, is an event default Fitch [classification criteria]", the company said in a statement.

Previously, other rating agencies have threatened to declare a default value of a debt restructuring.

Observers suggest they are under great political pressure not to do so, as if they are severely could undermine confidence in the economy of the euro zone and their banks.

Herman Van Rompuy: "this situation was... threatening the stability of the euro area"

The ECB and France have been particularly opposed to a restructuring and private sector participation, but it was finally insisted on Germany.

Mr Sarkozy dismissed the importance of the participation of banks in the aid package.

"If rating agencies use the word that has been used (by default), it is not part of my vocabulary."Greece pays his debt, he told reporters.

President of the European Commission José Manuel Barroso indicated plans to curb the power of the agencies.

"... "Endorsed us the plan for reduction of dependence on external credit ratings," he said, adding that policy makers could be presented in autumn "new proposals".

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