Spreadex Market Update
Markets return to Greek waiting game on quiet Monday
Ahead of the meeting’s start Schauble labelled the new Greek government irresponsible, with Syriza countering that it is Germany who is acting irresponsibly; this tit-for-tat attitude that has dominated much of the Eurogroup conversation suggests that the markets are right to be downcast on the chances of a Greek-debt solution being found today. In another ominous sign, the Bundesbank has warned Greek banks against buying more Greek government debt and that they should ‘improve their liquidity position’; not exactly comments conducive to compromise before this afternoon’s showdown.
On top of this is the worrying ‘ceasefire’ situation in Ukraine, which unsurprisingly hasn’t been as smooth as hoped. Reports that separatists have heavy shelled a government-held town were joined by accusations that Ukrainian military bombed the Donetsk airport; despite the implementation of new sanctions against Russia and separatist strongholds, the region remains engulfed in violence. The market cheer following last week’s ceasefire agreement seems a world away on this dour Monday morning.
After a slight wobble at open, Brent Crude has now pushed above $62 per barrel, in what could be its third consecutive week of gains. This run, unimaginable in mid-January, remains a bright spot on this quiet Monday, but hasn’t been enough to overshadow European uncertainty.
The FTSE continues to be bogged down by the seemingly never-ending issues in the Eurozone, despite strong performances from some of its key stocks. Much like the tail end of last week, the stars remain Premier Oil and Tullow Oil, both of whom continue to swell alongside the rising fortunes of oil; however, it was not all good news for the sector, as Hunting and Afren (ever its own special case) slipped to losses. Vedanta Resources continues to be buoyed by the ratings upgrade it received last week, whilst similarly shoe designer Jimmy Choo has gained nearly 6% on the markets this morning after being given an ‘overweight’ rating by HSBC.
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