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Miners mitigate losses in London
Eurozone equities are being ground down by Greek fears, and financial stocks across the EU are bearing the brunt of the selloff. British banks have being dumped by worried traders as Greece’s future in the eurozone has become more uncertain. Dealers despise being stuck in the middle of Greece and Germany, and they won’t want to wait around for another political standoff between the two sides. The London market has the mining sector to thank for its relatively small losses in comparison with its eurozone counterparts. Natural resource stocks are attractive when stacked up against banks and insurers that have large exposures to continental Europe.
Greek fears cross the Atlantic
In the US, the Dow Jones is down 60 points at 17,760, as fears over Greece have gripped Wall Street. The US market is geographically and financially separated from Europe, but some of the nervousness has crept in nonetheless. The words of former Federal Reserve chairman Alan Greenspan reverberate around Wall Street today, that Greece will leave the currency union. Big oil stocks dominate the largest gains in the US market, and Chevron and Exxon have added 1.3% and 0.6% respectively. The stability in the oil market has seen funds flowing back into oil companies as traders seek bargains.
Chinese data hampers copper
Copper has been dented by the disappointing trade figures from China overnight, with the record trade surplus revealed by Beijing drawing attention to the sizeable drop in imports. A muted reaction by traders indicated that the move was priced in already. Gold is back in demand as traders seek a safe haven while the Greek tragedy plays out. Oil - Brent Crude is beginning to find a bottom, but the problem the energy is suffering from is its inablity to break through the $60 mark, and sideways trading is what dealers can expect in the near term.
Greece and Ukraine weigh on euro
The euro is under attack, as Greece is refusing to roll over and just accept the ECB’s demands. The Syriza party is playing a dangerous game of chicken with the rest of the eurozone, and talk of the indebted nation going it alone is on the rise. Athens is on a collision course with Frankurt and neither side wants to blink first. And Greece is not the only country that is a thorn in the side of the euro: tensions in Ukraine are keeping the currency under pressure, as sanctions against Russia have been postponed until talks in Minsk get under way. The Australian dollar is feeling the pinch after Chinese imports plummeted, and this will put the onus on domestic demand to boost the Australian economy.