ECB plays hardball with Athens

In mid-morning trading the FTSE 100 is down 20 points, at 6840, as the European Central Bank cancels its acceptance of Greek government bonds in exchange for funding. 

Tesco sign
Source: Bloomberg

The ECB is trying to keep Greece in line, and this has sent a ripple through equity markets. The move has crushed Greece under the weight of its own debt. Yanis Varoufakis has learned that he can’t have his cake and eat it too, and in order for the ECB to back Greece the austerity scheme must be kept to schedule.  

Tesco is in trouble again after the Groceries Code Adjudicator launched an investigation into the supermarket's suspicious payments to suppliers. Although the GCA investigation is not as consequential as a Serious Fraud Office investigation, it strips away another layer of confidence traders have in the supermarket chain.

BT is back in the mobile phone market after its acquisition of EE; the desire to break into the quad play arena was the motivation behind the takeover, and it gives BT the edge over Sky

Shares in AstraZeneca have taken a tumble after the drug company revealed a fourth-quarter loss, and the dreary outlook only compounded the company’s problems. AstraZeneca fended off Pfizer’s takeover attempt last year, and now the company is going on its own acquisition trail by taking over Actavis’s respiratory drug division in North America.

We are expecting the Dow Jones to open 10 points higher at 17,683, as the US benchmark is gaining back the momentum it lost last night due to the ECB's actions in relation to Greece. The jobless claims report at lunchtime will set the mood for the non-farm payrolls announcement tomorrow. Traders' expectations have been lowered in light of the ADP report yesterday. 

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