European shares were called to open higher on Monday as exit polls showed the Greek people had voted for pro-austerity party New Democracy in the second set of elections in as many months, easing fears of a Greek exit from the euro zone.
The FTSE was called to open 55 points higher at 5534, the DAX was seen opening 132 points higher at 6361 and the CAC 40 was expected to open higher by 150 points at 3138.
Political party New Democracy, which supports the current terms of the bailout package agreed to between Greece and the so-called “Troika” of the European Union,(EU), International Monetary Fund (IMF) and the European Central Bank (ECB) won a slim majority in parliamentary elections on Sunday giving it the right to attempt to form a coalition government.
The party beat the leftist coalition of Syriza, led by 37-year-old Alexis Tsipras, who had argued that Greece should reject the current deal and renegotiate its terms with the Troika.
The win brought relief to the euro zone, which had been braced for fresh financial turmoil.
With 97 percent of ballots counted, New Democracy had taken 29.7 percent of the vote, with Syriza coming a close second on 26.9 percent. Former governing party PASOK, which collapsed in November of last year and was replaced by a technocratic government, came in third with just 12.3 percent of the vote.
A 50-seat bonus given to the party which comes first in the elections would give a New Democracy/PASOK coalition 162 seats in the 300-seat parliament. Both parties are broadly committed to the 130 billion euros ($164 billion) bailout.
Global markets responded positively to the news. The euro jumped to a one-month high, and Asian shares rose on Monday.
U.S. stock index futures and riskier commodities such as crude oil also rose, while safe-haven gold fell after having gained for the previous six sessions.
The G7 responded to the election by saying it was in "all our interests" for Greece to remain in the euro zone while respecting its international bailout commitments.
"We welcome the commitment of the euro area to work in partnership with the next Greek government to ensure they remain on the path to reform and sustainability within the euro area," the G7 said in a statement.
German finance minister Wolfgang Schaeuble was also quick to welcome the election result, saying late on Sunday that the German government viewed it as a clear decision by the Greek people to “forge ahead with the implementation of far-reaching economic and fiscal reforms."
U.S. President Barack Obamawill press European leaders this week to resolve the debt crisis, but the United States does not expect much progress before the end of the month, a White House adviser said on Sunday.
Obama will participate in a two-day G20 summit that starts in Mexico on Monday. He has called on European leaders to recapitalize weak banks and to focus on economic growth, not just austerity.
Elsewhere in Europe,French elections also held over the weekendsaw President Francois Hollande’s Socialists win a resounding parliamentary majority, strengthening his position in negotiations with Germany over support for indebted euro zone states weighed down by austerity and ailing banks.
The Socialist Party and its affiliates secured 307 seats in the parliamentary election runoff, according to the final count, comfortably more than the 289 needed for a majority in the 577-seat National Assembly.
Meanwhile, international leaders will meet yet again in an effort to avert a collapse of diplomacy over Iran's nuclear program at talks starting in Moscow on Monday, hoping to win concessions from Tehran and forestall a potential new war in the Middle East.
Israel has threatened to attack Iran if no solution to the dispute is found. Oil markets remain nervous over the prospect of intensifying regional tensions and further spikes in the price of crude.
Saudi Arabia's king led funeral prayers on Sunday for his heir, Crown Prince Nayef, whose death will force him to find a new successor capable of tackling domestic unemployment, bitter rivalry with Iran and turmoil in close Arab neighbours.
In corporate news, RAG-Stiftung, majority owner of German speciality-chemicals company Evonik Industries, is to scrap Evonik's initial public offering, a source told Reuters on Sunday.
RAG, which owns 75 percent of Evonik, refused to comment, while a spokeswoman for CVC Capital Partners., which owns the remaining 25 percent, said the private equity firm was in agreement with RAG in its assessment of the situation..
Axa Private Equity has raised $7.1 billion from outside investors marking the largest fund targeting investors looking to sell out of their buyout positions, the Financial Times reported on Sunday.
The investment arm of the French insurance group will focus on "secondaries" deals, in which it buys stakes in buyout funds such as KKR and Permira from the investors that originally backed them but are now looking to cash out, the report said.
The figure is double the amount originally foreseen by Axa, reflecting the increase in interest from financial groups such as pension funds, insurance companies and banks to amend or sell off their private equity positions, the report said.
The Hong Kong stock exchange agreed to pay 1.4 billion pounds ($2.2 billion) to buy the London Metal Exchange, the world's biggest marketplace for industrial metals, underscoring the global shift in manufacturing to Asia.
General Electric will buy a medium-sized business in Germany in the next six months in order to expand its technological footprint, German daily Sueddeutsche Zeitung reported, citing a manager at the U.S. conglomerate.