Europe close: Stocks waver at the end

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LONDON (ShareCast) - -Cool reaction from analysts to Eurogroup agreement on Greece
-Fitch says Greece agreement eases near-term risks
-Greek 10 year bond yields fall 26bp to 16.24 per cent
-ECB's Hansson says worth examining a negative deposit rate
-Euro/dollar rebuffed at 1.30

FTSE-100: 0.22%
Dax (Xetra: ^GDAXI - news) -30: 0.55%
Cac (Frankfurt: 924169 - news) -40: 0.03%
FTSE-Mibtel 30: -0.26%
Ibex 35 (Madrid: IBEX.MC - news) : -0.14%
Stoxx 600: 0.32%

Core Eurozone equity benchmarks finished higher, but only slightly so, following the cool reaction from economists to the 'breakthrough' achieved at last night's meeting of Eurozone finance ministers, the so-called Eurogroup.

The 'deal' appears quite ambitious but still faces various hurdles. The assembled ministers agreed to lower the country's stock of debt to below 124% of gross domestic product (GDP) by 2020. Furthermore, they agreed to work to bring Athens's mountain of liabilities down to "substantially lower" than 110% of GDP in 2022.

Amongst the measures agreed on to achieve the above were: reductions on the interest-rate paid on loans to Athens, an extension of the maturities on the loans, the European Central Bank (ECB) returning the profits earned on its holdings of Greek debt and a buyback of Greek debt at sharply discounted prices.

It is the success of the latter which seems to worry observers the most (although it is not the only source of preoccupation), as the entire package - and the International Monetary Fund's (IMF (Other OTC: IMFAF.PK - news) ) involvement - seems to hinge on it. Furthermore, without the IMF's backing Brussels could be left scrambling to find how to plug another significant gap in the Mediterranean nation's financing needs.

In that regard, Kathleen Brooks, Director of Research at Forex.com had this to say: "As usual when it comes to meetings with European Union (EU) officials, they tend to under-deliver. They didn't actually reduce Greece's debt burden and no official holders of Greek debt like the ECB or European governments have had to take haircuts on their debt holdings. Thus, Greece's debt reduction is still reliant on its economic performance, which remains dismal and is likely to continue to be enveloped in recession for many more years."

In a similar vein, Fabio Fois from Barclays Research remarked that: "some of the measures are steps in the right direction; however, we think that, as they were announced last night, they will be not sufficient to reduce public debt substantially and so to restore debt solvency by 2020. We also found surprising the fact that no fresh funds were committed, not even for the debt relief. On this specific point, we think it is worth noting the comment made by Christine Lagarde: "Once progress has been made on specifying and delivering on the commitments made today, in particular implementation of the debt buybacks, I would be in a position to recommend to the IMF Executive Board the completion of the first review of Greece's program."

Carrefour (EUREX: C1AR.EX - news) planning foray into China

French spirits maker Remy Cointreau (Euronext: RCO.NX - news) unveiled first-half operating profits from continuing operations of €141.5m, ahead of consensus estimates.

French supermarkets group Carrefour was higher on reports that it is to move into the Chinese market.

Portuguese Energy Group Galp dropped after Eni (EUREX: E1NT.EX - news) announced that it will unload shares in the Iberian (Euronext: 10870921.NX - news) company.

From a sector stand-point the best performance on the DJ Stoxx 600 was seen in the following groups of stocks: Real estate (Euronext: SRE.NX - news) (0.73%) and Personal and Household goods (0.67%).

French consumers hold up

INSEE's French consumer confidence gauge for the month of November (Xetra: A0Z24E - news) has come in at 84, the same as last month (Consensus: 83).

Italian hourly wages rose by 0.2% month-on-month in October, following a gain of 0.1% in the previous month.

Slight gains in single currency

The euro/dollar is now falling by 0.47% to the 1.2933 dollar mark.

Front month Brent crude futures are now retreating by 0.681 dollars to the 110.17 dollar mark on the ICE.

AB