EUROPE - Asset managers supported the Greek parliament's approval of a range of highly unpopular austerity measures, but warned that serious problems remained for European and global markets.
Parliament narrowly approved the measures - a prerequisite for receiving the next tranche of a bailout package organised last spring - with a larger than expected majority of 155 for and 138 against.
The vote means the EU, the IMF and the European Central Bank (ECB) - the so-called troika - are likely to OK a second bailout to the tune of €120bn, as well as pay further installments of the earlier loan.
However, a large minority of lawmakers have opposed the €28bn austerity package vociferously, against a backdrop of increasingly violent demonstrations outside parliament.
Dan Morris, global strategist at JP Morgan Asset Management, said this continuing political resistance could pose further problems for the country.
"While EU leaders had initially insisted on cross-party support, they have settled for simple passage of the package," he said.
"The opposition complains - with some justification - that the previous programme was an evident failure and that the new one is only more of the same."
He added that the US Federal Reserve's recent extension of a crisis lending programme to the ECB and other foreign central banks - allowing them to obtain US-dollar liquidity from the Fed - showed that global monetary authorities were "well aware of the risk to markets if turmoil from Greece spreads".
Ted Scott, director of global strategy at F&C Asset Management, welcomed the news of the parliamentary vote, but warned it did not mean any of Europe's periphery countries would be saved from possible default restructuring further down the road.
"Indeed," he said, "as it has done in the past, the troika has only kicked the can along the same road and, each time it provides a bailout, it becomes more difficult to convince markets and the country concerned it is the correct strategy."
He added: "The strategy of addressing short-term liquidity needs, instead of solvency, is not sustainable and ultimately doomed to failure.
"While the news is welcome, it will only bring glad tidings if the troika recognises it is vital to change strategy and introduce the fundamental reforms that are necessary to help the periphery countries' solvency position that has only got worse since the crisis began almost 18 months ago."
The Greek parliament will vote on the finer details of the austerity plan's implementation on Thursday, while the decision to disburse the funds is expected on 3 July.