By Marius Zaharia
LONDON, Feb 2 (Reuters) - A surge in Greek bond yields stalled on Monday as the new Syriza-led leftist government pitched a new debt deal to its European Union partners, sounding less confrontational than before in the view of market analysts.
Relief periods in Greek markets have been very brief in recent weeks, however, and with few concrete pointers to a deal, yields remained close to some of their highest levels since the 2012 default.
French Finance Minister Michel Sapin said after meeting his new Greek counterpart Yanis Varoufakis that Athens could not expect a straight debt write-off, but he left the door open to other options including giving Athens more time for repayment.
Varoufakis, who travelled on to London to meet British Chancellor George Osborne on Monday, told Britain's Channel 4 News that he expected to reach a rapid deal on its debt situation.
He was expected to meet around 100 banks and financial institutions to say Greece would be able to service its debt to private investors, according to a source with knowledge of the matter.
Greek 10-year yields were unchanged at 11.40 percent as markets closed, having earlier swung down 30 basis points to a day's low of 11.14 percent, not an unusual shift in an illiquid market.
"The tone from the Greek officials sounds not as confrontational and harsh as (before)," said Rainer Guntermann, rate strategist at Commerzbank. "But it can quickly go the other way. There is still elevated headline risk in that market."
Greek Prime Minister Alexis Tsipras, in Nicosia, ruled out seeking aid from Russia and again ruled out leaving the euro.
The German Finance Ministry said the minister, Wolfgang Schaeuble, would meet Varoufakis in coming days, but no concrete arrangement had yet been made. German Chancellor Angela Merkel will have a chance to meet Tsipras at a EU summit next week.
Germany, Europe's dominant economy, is expected to take a hard stance in opposing Syriza's aim of ending austerity measures and renegotiating Greece's debt, although some other EU members have suggested more flexibility.
"They are looking to divide the euro area," said KBC strategist Piet Lammens. "The Germans, of course, are very reticent."
Elsewhere, Italian 10-year yields were also broadly unchanged at 1.62 percent, as political uncertainty in Italy eased after parliament chose Sergio Mattarella, a constitutional court judge and veteran centre-left politician, as president on Saturday.
The vote showed Prime Minister Matteo Renzi in control of his party and allies in the ruling majority as he seeks to pass reforms to lift Italy out of six years of on-off recession.
"There is relief that Italy managed to find a new president, especially one that's favoured by Matteo Renzi," said Felix Herrmann, a market strategist at DZ Bank.
German Bund yields, the euro zone benchmark, matched a record low of 0.299 percent before edging back up to around 0.31 percent as markets closed. (Editing by Kevin Liffey)