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Europe: Shares rally on hopes of Greek debt deal

[PARIS] European stocks rose early on Tuesday, lifted by hopes for an agreement on the Greek debt standoff after the country's new government dropped calls for a write-off of its foreign debt and proposed swapping debt for growth-linked bonds.

Finance Minister Yanis Varoufakis, in London to reassure private investors that he was not seeking a showdown with Brussels over a new debt agreement, said the new left-wing government would spare privately held bonds from losses, a source told Reuters.

At 0802 GMT, the FTSEurofirst 300 index of top European shares was up 0.5 per cent at 1,473.10 points.

Spain's Santander rose 1.6 per cent after the eurozone's biggest bank reported a nearly 70 per cent jump in fourth quarter profit, lifted by earnings from its lending business and as charges on soured loans fell.