Greek elections: Pro-bailout party wins, easing global economic fears (for now)

Dylan Stableford
June 17, 2012

Greeks voted in crucial elections on Sunday, with the center-right New Democracy party receiving about 30 percent of the vote, according to the government's projections. The results will likely keep Greece and its ailing economy in the euro zone, and ease fears among the world's financial markets of the "economic tsunami" that could have been--at least temporarily.

Financial analysts are waiting to see how the Asian and European markets react to the news when they open Monday.

According to Reuters, New Democracy took 29.5 percent of the vote and the socialist PASOK party took 12.3 percent--giving the pro-bailout parties a majority or 161 seats in the 300-seat parliament.

[Also read: White House welcomes Greek vote]

The radical-left Syriza party came in second, with 27.1 percent. According to the AP, Syriza chief Alexis Tsipras conceded the election.

"I am relieved," New Democracy leader Antonis Samaras told Reuters. "I am relieved for Greece and Europe. As soon as possible we will form a government." New Democracy and PASOK are committed to a $300 billion bailout.

"The Greek people voted today to stay on the European course and remain in the euro zone," Samaras said in a victory speech. "There will be no more adventures, Greece's place in Europe will not be put in doubt."

In a statement released late Sunday, Euro zone finance ministers reiterated its "commitment to assist Greece."

[Slideshow: Greek elections]

"It looks like we've avoided the worst case scenario," Darren Williams, a London-based European economist, told the New York Times. "I think that's important because we could have gone to a very bad place very quickly."

The euro gained in value against the dollar on Sunday, the Times noted, "an early sign that the outcome could provide at least a temporary lift to global financial markets."

The elections did, however, expose "a deeply divided society," Reuters said, and "could leave an emboldened Syriza leading new protests against a coalition governing with significantly less than 50 percent of the electorate's support."

The Times also cautioned that previous market rallies in Europe have been short-lived: "A few weeks ago, markets initially responded positively to a bailout plan for Spanish banks, but that optimism quickly gave out when the American stock markets opened on Monday."