Spreadex Market Update
Eurozone markets shrug off increasingly dire Greek situation
Eurogroup chief Jeroen Dijsselbloem has bluntly stated that 'Greece's money is running out' and that an agreement needs to be reached soon if the region is to avoid the instability that would follow a (insufferably named) Grexit. Yet, rather unsurprisingly, despite this warning form the Eurogroup chief, Eurozone officials are ensuring no one expects anything from Friday’s meeting in Riga by downplaying the likelihood of any progress being announced at the end of the week.
The wolves are knocking at the gates of Greece, and Athens has practically nothing to hold them off with. Yet once again the Eurozone indices took no notice. Yes, the euro may start to fall every now and again, but since ECB QE that has been its modus operandi anyway; the fact that the fear of contagion from a Greece/Eurozone split no longer holds as much sway over the rest of the Eurozone is being reflected in the markets. Of course, if Greece does actually leave the Eurozone things will be different, but for now the region’s indices seem less sensitive to Grexit rumours than they once were.
The FTSE managed to snatch back some of the gains it had lost around lunch time, but still failed to scale the heights it had hit immediately after the bell this morning. The lack of turnaround from the index’s oil and mining stocks always meant it was likely the FTSE’s growth would be limited today, due to the index’s (over)reliance on its commodity stocks.
The US markets couldn’t capitalise on the gains seen by the futures this morning, with the Dow Jones slipping to marginal losses as the day went on. The NASDAQ and the S&P fared slightly better than the Dow, with the continued avoidance of any precipitous earnings season losses based on the strong dollar easing investors’ anxieties from earlier in the week. The dollar-situation will be tested further tomorrow, as Facebook, eBay, Coca-Cola and McDonald’s all announce their first quarter earnings.
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