Europe's financial markets have given a muted reaction to the announcement of a second bailout deal for Greece.

The euro was little changed from Monday's closing price, while leading European stock markets edged lower in morning trading.

London's FTSE was down 0.3% by lunchtime, while the Paris Cac and Frankfurt's Dax index were 0.6% lower.

Shares across Europe rose on Monday in anticipation of a deal being reached, with bank shares doing well.

Europe's banking industry has been bolstered by support from the European Central Bank.

In the latest bailout deal, Greece is to receive loans worth more than 130bn euros (£110bn; $170bn).

In return, it will undertake to reduce its debts to 120.5% of its GDP by 2020 and accept an "enhanced and permanent" presence of EU monitors to oversee economic management.

Greece needs the funds to avoid bankruptcy on 20 March, when maturing loans must be repaid.

'Problems remain'

"Effectively Europe's banks have been given almost half-a-trillion euros at 1%, very cheap money that has sort of ring-fenced the banks from the crisis. The thinking is that banks will not go bust if Greece fails," said Louise Cooper, market analyst at BGC Partners.

But she said few in the markets thought the latest bailout was the answer.

"This just puts off the inevitable. It's the second deal in two years. You're talking almost 20,000 euros per person [in Greece] in total bailout funds and even that amount has not solved Greece's problems. That suggests the money has not been well spent," she added.

"It [the deal] probably avoids a messy and chaotic default on 20 March, there are still a lot of steps to go through before then, but does it solve any of its problems? No."

Source;bbc