Syriza begin to form streamlined cabinet as jitters appear on the markets

After Monday saw impressive gains for the DAX and strong performances elsewhere in the Eurozone, news surrounding Greek cabinet appointments has caused the region to be less than enthused about the staunchly anti-austerity body it will have to soon deal with.

Syriza officials have already said it is ‘unrealistic’ to expect a full repayment of Greek debt, and the new finance minister Yanis Varoufakis is a renowned proponent of the damage austerity has caused to Greece. Syriza appear to be creating a 10-minister cabinet that is diametrically opposed to what Troika and the Eurozone would want from Greece, and the reality of this is finally making itself felt on the markets today.

The FTSE managed to rebound before yesterday’s close, but suffered a weak open after Afren announced that, unless it receives an equity injection or is taken over by Seplat, it will have to restructure its debts, leading not only to a 50% fall in Afren’s share price, but falls elsewhere in the energy sector. Brent Crude itself spent the morning fluctuating around the $48 per barrel support level that has become the norm in the past few weeks, not helping the already precarious situation. The renewed collapse of the FTSE’s energy sector joins the recent problems in the mining sector as copper’s decline continues to plague the UK index.

The UK’s GDP data this morning then came in mixed. Prelim GDP q/q fell to 0.5%, lower than both the forecast 0.6% and last quarter’s 0.7%. However, the fact that 2014’s full year GDP was 2.6%, the highest since 2007, took some of the sting out of the tail of this announcement. The overall picture is positive, but the final quarter slowdown is not the greatest sign for 2015, especially since this figure should have theoretically been aided by the current low oil prices.

Earnings season continues to provide blow after blow for the US markets, epitomised by the dismal performance by Microsoft which saw profits fall nearly 11% in the last quarter. Apple are expected to announce a robust earnings release later today, but unfortunately for the US markets it will be after the closing bell. This means they will have to make do with the recently troublesome core durable goods orders data, alongside a consumer confidence figure that will hopefully be buoyed by the continued cheapness of oil. The US markets are in dire need for a day of good news, but given the country’s recent figure form, they may have to wait a bit longer.