11:44

Stock markets around Europe have welcomed the tentative deal reached in Brussels this morning.

The eurozone’s blue-chip Euro STOXX 50 index hit a two-week high in morning trading and is currently up around 2%. Banking stocks in particular are benefiting from the relief rally and the eurozone banking index is up 2.7%.

Euro Stoxx Photograph: Thomson Reuters

Individual country bourses are also higher:



Germany’s DAX is up 1.7%



France’s CAC 40 is up 2.2%



UK’s FTSE 100 is up 0.7%

On bond markets, the yields on those bonds seen as most vulnerable to a Greek exit from the euro fell back on relief the crisis could be nearing resolution. The yields on the 10-years bonds of Italy, Spain and Portugal all fell back.



On foreign exchange markets, the euro initially rallied against other major currencies before easing back as traders looked beyond intitial positive headlines out of Brussels and considered the hurdles still to come this week. The single currency is now down around 0.7% against the dollar at $1.108 and 1.2% against the pound at 71.120 pence.





Euro vs dollar Photograph: Thomson Reuters

Analysts warn there are plenty of potential stumbling blocks ahead this week to unsettle markets.



Ruben Segura-Cayuel, Europe economist at Bank of America Merrill Lynch comments: