Spreadex Market Update
FTSE looking less robust as commodities slip, Greek situation begin to weigh
The latest rumour is that the ECB may increase the haircut on Greek bank collateral in response to the emergency funds transfer decree issued by the Greek government yesterday. Whilst these funds will be transferred to the ECB, in time it will make the increasingly poorer commercial banks in Greece more reliant on the ECB’s emergency liquidity assistance, something the central bank is keen to avoid. The latest kiss of death for Athens came from Larry Fink, the head of BlackRock, who stated that ‘if Greece does not capitulate, Europe has no choice but to kick Greece out’. Unsurprisingly, Syriza’s popularity is plummeting, roughly at the same pace as the Greek stock markets, which are now at their lowest point since the left-wing party came to power.
After nearing its all-time highs this morning, the FTSE’s growth severely fell off this morning, with the index only being able to cling onto the most marginal of gains. The weight of the downward turn by the FTSE’s oil and mining sectors increased as the day went on, with losses for Petrofac, Premier Oil, Anglo American and Rio Tinto all damaging the UK index’s previously robust health.
The US futures are still holding onto their gains despite things beginning to slip in Europe, with another day of earnings season to look forward to. Yahoo’s earnings is likely to be the biggest announcement, with news already leaking that the latest search engine agreement between the company and Microsoft includes a termination clause that can be triggered in October. This is a potentially risky move considering how far Yahoo’s search engine market share has fallen in recent years; at the same time, Microsoft’s Bing isn’t such a hot property either, so it will be interesting to see what the result of this Google-combatting deal will be.
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