Is it Greece's Lula moment?

As Greek politician Alexis Tsipras dances around the conflicting demands of his country's creditors and his party's supporters, the question is: Will he do the samba or the tango?

The samba would suggest he's following the example of former Brazilian president Luiz Inacio Lula da Silva, who embraced market friendly policies after winning in 2002 with anti-capitalist rhetoric. In contrast is tango-loving Argentina, which dumped a dollar peg in 2001 and then defaulted on its debt.

Investors are apparently betting on the samba. Only hours after Tsipras's Syriza party secured victory in the Greek general election, European stocks rose to a seven-year high and the euro rallied.

Tsipras rocked the markets by campaigning for an end to fiscal pain and a write-down of debt.

Lula's campaign promises were enough to send the real plummeting by 61% and stocks by 26%. Brazil's borrowing costs doubled because of worries that he would default.

But everything changed once Lula took office. He ordered 14.1-billion reals (now R62-billion) in spending cuts and repaid $15.5-billion in loans to the International Monetary Fund ahead of schedule. He appointed a mainstream economics team and gave the central bank free rein to fight inflation, which it did by raising interest rates.

The result: Brazil won its highest-ever credit rating and the economy grew by an average 3.5% in his first term and 4.6% in his second, outpacing the 2.9% of the previous decade, according to Bank of America Merrill Lynch.

So what chances of a repeat in Greece? Holger Schmieding, chief economist at Berenberg Bank, in London, quotes 50-50 odds that Tsipras will do what he calls a "half Lula". In that scenario, the new government does a deal with its lenders and secures new funding with a promise of reforms that it then enacts.

"All would end well after some initial hiccups," said Schmieding.

"Populists might lose their allure across Europe if Syriza bows to reality," he said.

For the scenario in which Greece falls out with its lenders, fails to secure European Central Bank support and ends up forced out of the euro area, Schmieding gives a 30% probability.