European markets surge, confident on reforms

Italy led European stock markets today in a robustly positive reaction to European Parliament elections which put conservatives in a leading position, but also gave anti-EU forces a huge boost in France and Britain.
The euro and sterling steadied after an initial wobble today despite nationalist shocks in European elections, with traders saying that economic reforms will continue.
On the crucial market where eurozone countries borrow to finance their debt, sentiment also appeared serene.
There was strong demand from investors to buy bonds issued by southern European countries hardest hit by the state of their finances and by the hardship of reforms, but which are now recovering.

Bond strategist Nordine Naam in Paris commented: "The (composition of) the European parliament will not change really... There was an anti-Europe message notably in France and Greece, but that is not the case across Europe and the market is taking account of the overall outcome."
The euro, which had opened slightly down affected by weak data for the German economy on Friday, edged up to USD 1.3652 from USD 1.3632 late on Friday. The euro rose to 139.05 yen from 138.91.
The dollar was steady at 101.85 yen from 101.91.
Markets in London were closed for a holiday, but Italy led European stock markets in an upbeat positive reaction to the election outcome overall.