FTSE stumbles as Greek default fears grow

In mid-morning trading the FTSE 100 is trading lower as a lack of progress in the Greece situation has spooked the market again. 

City of London skyline
Source: Bloomberg

Traders’ patience is at breaking point, and without a deal on the table for Greece the prospect of a default is growing. The spotlight is shining extra bright on Athens this week, with no agreement announced yet, and more dealers are exiting the market because they can’t stand the heat.

Traders don’t like being left in the dark, and if they are kept there for too long their anxiety gets the better of them and a sell-off ensues. Greece has years of practice of tough negotiating but on this occasion the stakes are even higher, and the nation is days away from defaulting.

Previous Greek governments have given into Europe’s demands at earlier stages in talks, but this time the Syriza party is  taking it down to the wire.

AMEC Foster Wheeler reported a dip in four-month LFL sales, and the stock is marginally lower this morning as the outlook for the company remains cautious. The engineering company is dependent on big oil companies for contracts, and while energy prices are relatively low AMEC Foster Wheeler can’t foresee a surge in businesses in the near future. Major oil firms are curtailing their capital expenditure, and until that changes the share price of AMEC Foster Wheeler will be capped. 

Wolseley impressed the market with a strong third-quarter performance across all its regions, and the stock has gained 3% on the back of it. The booming property sector has assisted the building supplies company,  and the low interest rate environment will keep credit-hungry consumers craving construction materials.

We are expecting the Dow Jones to open 90 points lower, at 17,950, and Greece is the culprit again. The US futures market is incurring small losses in comparison to its European equivalents, but the jitters surrounding Greece span far and wide. The uncertainty around whether Athens will have enough cash to make Friday’s repayment is making Wall Street wary.

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