* FTSEurofirst 300 up 0.6 percent
* Banks up on Greek news; RBS aided by UBS upgrade
By Tricia Wright
LONDON, Nov 27 European stocks rose on Tuesday,
recovering from weakness in the previous session after
international lenders agreed to reduce Greece's debt, paving the
way for the next disbursement of aid.
The accord, reached by the lenders late on Monday, will cut
Greek debt by 40 billion euros, bringing it down to 124 percent
of gross domestic product by 2020.
The FTSEurofirst 300 was 0.6 percent higher at
1,111.23 by 0919 GMT, having dipped 0.5 percent on Monday
following a five-session winning streak.
Traders, however, were doubtful as to the sustainability of
any meaningful market gains, perceiving the deal to be a
"What we've averted here is the likelihood of a Greek
default in the short term. I don't think it's taken it off the
table in the long term," Michael Hewson, senior markets analyst
at CMC Markets, said.
"We're still in the broad range in European markets and I
don't think this really changes anything with respect to that
... The outlook for growth in Europe still remains fairly weak."
Banks were the top risers in a broad-based rally as
investors drew strength from the Greek debt deal news.
A 4-percent advance put Royal Bank of Scotland near
to the top of the FTSEurofirst 300 leader board, with the
part-state-owned lender also boosted by a UBS upgrade to "buy".
But even with the Greek problem ironed over for now,
investors remain concerned by the threat of the U.S. 'fiscal
cliff' of automatic tax increases and government spending cuts
set to come into force in early 2013.
The euro zone's blue-chip Euro STOXX 50, which
lurched 5.3 percent higher last week, its best week since early
December, climbed 0.7 percent to 2,561.04, erasing all of
Phil Roberts, chief European technical strategist at
Barclays Capital, said the index's 200-week moving average, at
2,585, is the main barrier to further gains, with the index
having tested this level three times in as many months.
"To generate more upside potential we need a close above
there, but even still I'm not so sure that the market would race
away," he said.