Greece's bluff called

Even the most skilled politician would struggle to label this morning’s actions as anything other than complete capitulation from Greece. 

Greek flag
Source: Bloomberg

The Greek populace must be feeling even more shell-shocked than last week as they have woken up to Syriza having had its bluff called, folding to a series of harsh demands. Patience towards Greece and its aggressive haggling tactics has been eroded over the past few weeks, and a number of measures were subsequently added to the criteria that the country will need to meet. These new measures have led the markets to ask themselves just how few friends Greece currently has – or probably more likely, how few nations are willing to stand up to Germany. The early morning relief rally has weakened as once again the realisation that the Greek parliament has yet to ratify the deal sinks in.

Investors, meanwhile, remember that making assumptions about Greek politics has been a particularly precarious game of late.

From the sublime to the ridiculous, traders have watched with morbid curiosity as Chinese regulators have imposed draconian measures to ensure that the Shenzhen index stops falling. A combination of banning short-selling and the threat of jail time for those found to be flaunting this has seen few traders looking to do anything other than invest.

With the goings on in both China and Europe, US markets have found themselves in the unique position of being viewed as a calm pool of sanity by global investors, who are left wondering what is coming next. With all the chaos outside the US it is hard to believe that this week’s testimony from Fed chair Janet Yellen will be any different from the holding pattern seen in previous appearances.

Regardless of other regions, US investors could well be tempted back into the US equity market as earnings season cranks up. The bar for the latest corporate reporting period has been set at particularly low levels, almost ensuring a steady flow of expectation-beating figures throughout the coming  weeks.  

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

Find articles by analysts

Een artikel zoeken

Form has failed to submit. Please contact IG directly.

  • Ik wens per e-mail informatie van IG Group bedrijven te ontvangen over handelsideeën en IG's producten en diensten.

Voor meer informatie over hoe wij uw gegevens mogelijk kunnen gebruiken, bekijkt u ons Privacy- en toegangsbeleid en onze privacy website.

CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen. 79% van de retailbeleggers lijdt verlies op de handel in CFD’s met deze aanbieder.
Het is belangrijk dat u goed begrijpt hoe CFD's werken en dat u nagaat of u zich het hoge risico op verlies kunt permitteren.
CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen.