Europe surges on hopes for scrapped referendum

Both the German Dax and the French Cac 40 are rallying on hopes Greece is more likely to accept the debt deal, and as the ECB takes action to tackle the crisis.

Markets surged on the news Greece is set to hold an emergency cabinet meeting after ministers broke ranks with the prime minister over his controversial referendum plans. The planned referendum had prompted investor panic that voters might reject the plan and force Greece into a disorderly default, spreading financial contagion to Italy and Spain. News that the European Central Bank has cut interest rates to 1.25% from 1.5% has also given markets a lift, after the ECB reversed a previous move to raise rates from 1.25% to 1.5% in July. By 13:15pm, the Dax was up 3.17% to 6,154, whil...