Greek opposition declares anti-austerity triumph in local vote

By Lefteris Papadimas ATHENS (Reuters) - Greece's main opposition party Syriza declared a victory for its anti-austerity message on Monday after its candidates fared strongly in big local election races in Athens and the surrounding region. In what may have been a foretaste of the upcoming European Parliament vote, the radical leftist party's candidates got most votes on Sunday in the race to govern the wider Athens region and for Athens mayor, knocking out Prime Minister Antonis Samaras's mayoral candidate. Both candidates will be in a runoff against more mainstream leftist-backed incumbents, who now have Samaras's support. "This is an omen for political change because Greeks are extremely frustrated, disappointed and desperate because of austerity policies and are trying to find a way to express this frustration," Syriza leader Alexis Tsipras told La Repubblica newspaper in Italy where he was campaigning on Monday. Tsipras is the radial European Left's candidate to become the next European Commission president. "The polls show that Syriza will win the EU (Parliament) elections next Sunday and this will probably trigger political developments in the country but also send a strong message to Europe against austerity." Syriza, which is against Greece's European Union/International Monetary Fund bailout, has sought to cast the local and EU elections next week as a referendum on the ruling coalition's pro-bailout, austerity policies. Samaras's government, however, played down Sunday's results as inconclusive, pointing to a string of first-round victories by the two ruling coalition parties in the remaining 12 regions as well as in most other big cities. "This result does not give anybody a reason to celebrate," government spokesman Simos Kedikoglou told Greek television, denying the government's stability was at stake. "The key issue is stability. The government must conclude its mission. We are at a decisive phase. We have covered a big part of the journey but we still have work to do." Financial markets also took the results in their stride. The Athens stock market was up 0.9 percent in afternoon trade after rising as much as 3.4 percent earlier on Monday, with traders saying the results were not a knock-out blow to the government as feared. "It's not as disappointing as the market had discounted at the end of last week," said Takis Zamanis, a trader at Athens-based brokerage Beta Securities. "This result doesn't seem to be threatening the government's stability." Yields on 10-year Greek government bonds were down 10 basis points to 6.68 percent. Investors are closely watching the outcome of next week's EU vote to see if it ushers in a new bout of political instability in Greece that dashes a feeble recovery taking root in the country after six years of recession. Polls have largely shown Syriza with a narrow lead over Samaras's conservative New Democracy party for the EU vote, though one poll published on Sunday by Kapa Research showed Syriza with a nearly 5 point lead over the ruling party. (Additional reporting by Harry Papachristou and Renee Maltezou, Writing by Deepa Babington Editing by Jeremy Gaunt)