Stock markets went on a surge after scale of surprise rescue package stunned most observers and analysts.

The package was an attempt by Europe to lift the siege on the beleaguered single currency.

From Guardian.co.uk:

The European Central Bank and national banks in the eurozone also pressed the button on the so-called "nuclear option", launching a programme of buying up debt of the most vulnerable eurozone countries after stating last week that they were not entertaining the option.

The scale of the safety net stunned most observers and analysts. Following a dive of more than 4% against the dollar last week, the euro recovered to make its biggest gains in 18 months before falling back to 1.28. While much comment and analysis has predicted a weak euro facing the prospect of meltdown, senior European officials and governments would be more than happy to see the euro stabilise at a relatively low 1.30 to the dollar, with Germany particularly benefiting from its champion export status.

However, the verdict of the markets was still out. "The actions taken by the EU officials will buy them time but there are still a lot of questions unanswered," said Jane Foley, research director at Forex.com. "At the core of the Greek fiscal crisis is the inability of the Greek government to live within its means."

Moody's Investors Service said it may still downgrade Portugal's ratings and that its investment grade rating of Greece could fall as low as junk.

EU finance ministers concluded 12 hours of negotiations in Brussels and unveiled a surprise €750bn (£645bn) package aimed at defending the 16-country eurozone against risks of unraveling in the wake of Greece's debt crisis.