Spreadex Market Update
Greek doubts contribute to flat morning
Over in the Eurozone, Greece’s bailout extension remains firmly hypothetical until Friday, with growing discord both at home and in Germany. Ever the ray of sunshine, Wolfgang Schauble questioned the Greek’s trustworthiness in a move that is sure to improve the already precarious relationship between the two countries. Despite the questionable wisdom of this comment, it does capture the sentiment of Germany, where rumours suggest at least 60 MPs could rebel against the bailout extension when voting at the end of the week.
Schauble’s comments also gained an extra air of validity as the Greek energy minister muddied the privatisation pledge Syriza had made in their reforms list. The energy minister claimed that the sale of Greece’s biggest electricity provider, PPC, would not go ahead, with Yanis Varoufakis coyly stating that whilst no former privatisations will be overturned, ongoing sales may be subject to change. It is unsurprisingly that, given the lack of other news in the region, these creeping doubts over the Greek bailout are slightly weighing on the Eurozone indices, which have begun to dip in the red as the day has continued.
The FTSE was the biggest loser of the major indices this morning, with the ongoing declines of AO World and Weir Group negating the gains being made in the mining sector. Brent Crude began once more to push towards $60 per barrel, but it hasn’t yet done enough to convince investors that the FTSE’s oil stocks are worth their current price. With no news on the horizon, the FTSE will be looking to a strong US open to help drag it out of its slump.
However, things aren’t looking too bright over in the US of A. The US futures have continued to look limp before their open; to be fair, this flatness is understandable given how quiet this Wednesday morning has been. This afternoon Janet Yellen will undergo day two of her testimony, this time in front of a House of Representatives committee; yet the Fed chair is unlikely to say anything surprising, and with only new home sales in terms of data things might not be as explosive as yesterday come closing time this evening.
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