MORNING BRIEFING: Greek aid determined, but euro still down

[RTFX-Trading]

MORNING BRIEFING:  Greek aid determined, but euro still down

What’s new:
Euro Zone: Greek joint aid determined, markets troubled by Euro Zone Fiscal troubles
China: Raises required reserves to cool property market & general economy
United states: Bill for Oil spill could exceed USD 14bln


Today:



Overnight Rates and Indices:
EURUSD: 1.3349 – 1.3206.
USDCHF: 1.0848 – 1.0743.
GBPUSD: 1.5322 – 1.5211.
EURJPY: 125.44 – 123.99.
USDJPY: 94.14 – 93.84.
DowJones: 11’008.61  -1.42%
NASDAQ: 2’461.19 -2.02%
S&P 500: 1’188.16 -1.54%
Nikkei: 11’057.40 +1.21%.
Shanghai: 2’870.611 +0.08%,
Gold: $1’177.70
Crude Oil: $86.03
 
Comments:

As was expected, Greek aid has been determined over the weekend.  Greece will be getting 110Bln euro over three years, it was also agreed that the first funds would be released in time for the next bond maturity due May 19th. In exchange Greece will be adopting the austerity measures promised.  EU member states will provide EUR 80bn, whilst the IMF will offer the rest. Funds will be released in installments to coincide with quarterly progress reviews.

This settles the Sovereign default worries but the relief was short lived because the euro still lost support to most of its major counterparts early this morning on worries of Euro-zone fiscal troubles.

In an effort to cool down the property market and the economy in general, China tightened its required reserve ratio by another 50bp, to drain more cash from the economy.

Today data for Euro Zone PMI, together with Personal spending data and the ISM Manufacturing from the US, amongst others, expected. With holidays in Japan, China and the UK trading is expected to be light today.

Good Day.


Rudolf Muscat

Trading desk

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