Spreadex Market Update
Eurogroup draws focus as Greek-deadline looms
Another painfully quiet day of data will see all eyes on the Greek issue, with all the uncertainty and contradictory rumours that comes with the territory. Already the ever-cheery Wolfgang Schauble has thrown cold water on those who think a solution will be found, saying he is very sceptical an agreement can be made, whilst France’s Sapin used his foresight to predict ‘huge danger’ for Greece if it leaves the Eurozone. It will be comments like this that are likely to dominate the day, and the markets are already reflecting the volatility caused by such statements as the Eurozone indices limped to Monday’s open. This situation was exacerbated by the tentative situation in Ukraine, which has still seen pockets of violence despite the ceasefire officially beginning on Sunday.
Ahead of the its year-on-year CPI figures tomorrow, the CBI have upgraded the UK’s growth forecasts to 2.7% from the 2.5% predicted in November. The slowly improving situation in the job sector alongside the oil-and-food-prompted low inflation should provide, according to the CBI, the continued boost to household spending that is leading UK growth. However, and rather unsurprisingly, the organisation warned of the situations in Ukraine, Greece and the UK’s own election as potential destabilisers as 2015 continues. It was these destabilising factors that led this morning’s open for the FTSE, as it followed Europe to a weak start to the week.
If the FTSE is to shake off the Monday blues, if may be due to the performance of oil. Brent Crude closed last week at above $61 per barrel, and the maintenance of, or improvement on, this level would likely prompt another strong day from the FTSE’s influential oil sector. Similarly, if copper can keep above $260 per pound, there might be some positive movement from the mining sector with Vedanta already building on its surge last Friday.
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