European stocks were set to open higher on Friday, as euro zone leaders finally agreed on a fresh bailout for Greece and on enhanced powers for the monetary union's rescue fund.
Adam Gault | OJO Images | Getty Images
Share Price chart
The FTSE was set to rise 32 points at the open, the DAX was predicted to open 35 points higher while the CAC was expected to post an increase of 23 points.
The leaders in the 17-member single currency area decided to relax lending conditions for Greece, Ireland and Portugal, which benefited from a first round of bailouts in order to help their battered economies survive.
The maturities of the loans to these countries will be extended from seven years and a half to 15 years and the interest rates cut from between 4.5 percent and 5.8 percent now to 3.5 percent, according to the new agreement.
The European Financial Stability Facility will be allowed to buy bonds in the secondary market and to give precautionary lending to members before their access to markets was blocked, prompting French President Nicholas Sarkozy to say an European Monetary Fund was created.
Greece's private sector creditors will take a 21 percent loss on their bond holdings, with four options being offered to them, including three exchange offers and one rollover into debt with a maturity of 30 years or a bond buyback scheme, Reuters reported.
Banks that will take part in the rescue include Deutsche Bank
Wall Street closed higher on news of the deal and Asian stocks were also trading in the green.
On the macroeconomic front, Ifo Business Climate index data will be released in Germany at 9:00 am London time and new industrial orders data for the European Union for May will come out at 10:00.
In earnings news, TomTom , the Dutch navigation equipment and digital map maker, reported a net loss of 489 million euros ($704.2 million) in the second quarter, reversing a profit of 11 million euros in the first quarter.
Its operating expenses included an impairment charge and restructuring charges.
TomTom has lost ground as consumers turn to free or cheap navigation services, such as those offered by Google or Nokia.
Vodafone confirmed it full-year outlook and said its organic service revenue increased by 1.5 percent in the first quarter, slightly better than the 1.4 percent rise expected by analysts polled by Reuters.