European stocks close higher awaiting Greek deal

European stock markets closed solidly higher on Monday as traders focused on Greece's efforts to strike a bailout deal, while betting on the outlook for US interest rates.

Frankfurt's DAX 30 index jumped 1.83 percent to 12,086.01 points, while the CAC 40 in Paris ended 0.98 percent higher at 5,083.52 points.

London's benchmark FTSE 100 index climbed 0.53 percent to 6,891.43 points compared with Friday's close.

US stocks were also up in late morning trades in New York, among new activity in health services and energy sectors.

The Dow Jones Industrial Average was up 1.50 percent, while the tech-rich Nasdaq Composite Index rose 0.83 percent.

The euro fell to $1.0818 from $1.0890 late in New York on Friday.

"The eurozone remained a veritable Emerald City for investors, with green scenes throughout the region," wrote Spreadex analyst Connor Campbell.

"Germany even managed to sneak in positive inflation to the mix... The US markets exploded out of the gate, and in a rare sight managed to ignore the strong dollar."

Other analysts expected similar movement as the week moves ahead.

"Despite the short week in Europe (owing to Easter), there is still plenty on the agenda to move markets, with Greek reforms under scrutiny, Chinese monetary easing more likely and employment data in the US later this week giving investors further insight as to whether the June or September will herald the start of US rate rises," said Rebecca O'Keeffe, head of investment at stockbroker Interactive Investor.

Greek Prime Minister Alexis Tsipras said in remarks published Sunday that he hoped key talks with international creditors would yield a "happy ending" in the standoff over the debt crisis.

Experts from the IMF and the EU are scrutinising a list of proposed reforms put forward by Athens to try to unblock a new 7.2 billion euro ($7.81 billion) tranche of EU-IMF loans and avoid a debt default.

European Commission spokesman Margaritis Schinas warned Monday that "we're not there yet," while adding: "The fact that experts worked through the entire weekend and continue today is a positive sign."

Craig Erlam, senior market analyst at Oanda trading group, was also upbeat, saying: "I just don't think people are buying into the 'Grexit' anymore. A deal is always done and it would be truly bizarre if the same didn't happen this time."

The governor of the Greek central bank last week ruled out the country's exit from the eurozone.

"Grexit is not an option for Greece, it is not an option for the eurozone. It is not going to happen," Yannis Stournaras said.

- China stimulus hopes -

Elsewhere on Monday, Asian markets mostly rose after Wall Street's gains at the end of last week, while Hong Kong and Shanghai were boosted by hopes for more Chinese economic stimulus.

Investors took their cue from New York, where a four-day losing streak came to an end Friday despite figures showing the US economy grew at a slower pace than some expected in the last three months of 2014.

Asian stocks were supported also by comments from the head of the People's Bank of China suggesting it could announce further monetary easing measures to boost the economy.

"European equities are starting out the new trading week on a positive note receiving a boost from firmer Asian markets overnight and optimism that the Fed will raise rates gradually later this year," said Markus Huber, senior analyst at brokers Peregrine & Black.

"Renewed hopes that China will do more in the months ahead to boost its economic growth is giving the entire Asian region a lift... Furthermore comments by Fed Chief Janet Yellen last Friday evening have soothed fears that the Fed might feel forced to raise rates in a very aggressive way."