Europe open: Stocks rise as Syriza falls short of majority

European stocks began the day moving lower after Greece's anti-austerity party Syriza's stunning victory on Sunday, but for the most quickly recovered their poise to trade near unchanged.

As of 09:15 the Dax-30 was actually higher by 0.32% to reach 10,677.72.

The FTSE Mibtel on the other hand was down 0.98% to 20,320.72.

Spain's benchmark Ibex 35 and Paris's Cac-40 were nearly unchanged.

Economists expect little volatility as a result of elections

Contrary to the markets' worst fears Syriza did not achieve an outright majority, although it did come quite close.

Deutsche Bank’s George Saravelos wrote last night that, “the election outcome in Greece this evening is at the very top-end of an “anti-austerity” mandate that the electorate could deliver.”

Syriza have won 36.4% of the vote compared to 27.8% for the governing New Democracy party and are projected to win 149 seats vs the 151 needed for a majority on the 300 seat parliament, the German broker added in a note to clients.

Even so, various other economists seemed sanguine that even under a worst case scenario the threat to the Eurozone as a whole was rather limited given the financial reforms put in place over the last few yeas.

Erik Nielsen, global chief economist at Unicredit Bank AG, wrote: “A disaster scenario, which would lead Greece onto a slippery slope out of the Eurozone, cannot be excluded.

"Breaking with Europe would be a terrible move for Greece – but the rest of the Eurozone, particularly as the ECB has already announced the opening shot of QE, will skate through with only temporary and minor volatility.”

The Eurozone's finance minsiters were expected to broach the situation in the Mediterranen country when they met later on Monday.

The yield on Greek 10-year sovereign bonds was higher by 22 basis points to 8.72%. Following an initial bout of weakness the euro/dollar could be seen higher, appreciating by 0.89% to stand at 1.1246.

In a statement following last night's Greek elections Germany’s Finance Ministry reiterated that Finance Minister Wolfgang Schaeuble’s stance was unchanged. It read: “The agreements reached with Greece remain valid.”

Commodities take a hit

Copper futures on the other hand were coming under heavy selling pressure, surrendering over 3% to change hands at $5,345 a ton in London - close to their lowest level since July 2009.

Front month Brent crude futures were falling by -1.9% to $47.86 per barrel on the ICE. The Russian rouble was also registering losses after fighting in Ukraine engulfed the port city of Mariupol over the weekend.

The German IFO institute's widely-followed gauge of business confidence, for the month of January, edged slightly past forecasts, rising to a level of 106.7 from 105.5 in the month before.

The consensus forecast had been for an increase to 106.3.

Grocers in focus, commodities lower

Within the DJ Stoxx 600 the sharpest losses were to be seen in the following industrial groups: Basic Resources (-1.89%), Oil&Gas (-1.49%) and Banks (-0.88%).

Belgian supermarket group Delhaize achieved better-than-expected sales growth in the United States in the fourth quarter.The family which owns the iconic French department store Galeries Lafayette has increased its stake in supermarket chain Carrefour to 9.5%, Les Echos revealed on Monday.

Rolls-Royce has been awarded a contract to supply engines for major Chinese locomotive manufacturer CNR Dalian, marking its entry into that country's market for freight locomotives for export.

IAG, the owner of British Airways, will reportedly announce that Irish airline Aer Lingus has accepted its recent takeover bid. The Irish carrier confirmed on Sunday that it was considering a new offer of €2.50 per share in a move which values it at €1.3bn. The FTSE 100 group may, however, faces difficulties getting Irish officials to agree to the takeover.