Spreadex Market Update
IMF-compromise leads to €10.3 billion bailout for Greece; Marks & Spencer falls on new strategy announcement
The Eurozone finance ministers were at it all night, trying to hash out a deal that satisfies both those opposed to major debt relief (Germany) and those who are adamant that Greece cannot survive without it (the IMF). It appears that ground has been ceded on both sides, with the International Monetary Fund potentially joining the bailout by the end of the year following the agreement of a package of debt measures, measures, however, that are less comprehensive than the IMF was first pushing for.
Of course pushing the issue of debt relief down the road to 2018 is as typical a twist in this Greek saga as is imaginable, meaning the deal should be greeted with some scepticism. However, for now at least, the Eurozone indices are basking in the glow of ostensible progress, the DAX and CAC rising another 0.8% and 0.7% respectively following on from yesterday’s surge.
Despite having little on its own economic agenda until tomorrow the FTSE continued to receive some run-off goodwill from the situation on the continent, jumping another half a percent to cross the 6260 mark for the first time since the start of the month.
The main news out of the UK this morning revolved around Marks & Spencer, and the reveal of a new strategy from CEO Steve Rowe. However, even with a better than expected 4.3% rise in full year operating profit to £689 million, the news was a bitter pill to swallow, Rowe warning that his plan, which includes lowering clothing prices while improving their quality, will have an adverse effect on profits. This took the stock 7% lower, negating the gains made in the past few weeks following Rowe’s reshuffling at the top.
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