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In many respects, we are exactly where we were a week ago as the weekend’s Greek referendum was a resounding success for the ‘no’ party. The tone of commentary from around the eurozone has not demonstrated a unified view on what this means to the ongoing status of Greece as a member nation, and as such traders are left baffled as to what happens next.
Just to add an extra twist to the difficulties in gauging what is happening has been the decision of Yanis Varoufakis to step down as Greek finance minister. This is due to the fact that his abrasive negotiating manner could be counterproductive to any potential future negotiations.
The predictions of an Armageddon for equity markets have, as yet, failed to materialise. This has been partially delayed by another stimulus package provided by the Chinese authorities to the Shenzhen 300, which has been deflating at an alarming rate.
The possible ramifications of developments in Greece are so important that hardly a reference has been made to this week’s Conservative summer budget, nor the posting of the minutes from the latest FOMC meeting – two things that under normal circumstances would demand the markets’ full attention.
Rolls-Royce has announced a profits warning unlikely to gain as many column inches as it should among today’s other news – although we are still seeing traders dump the shares lower by 9% in early trading. Bovis Homes kicks off the week of trading updates by UK housebuilders with both completions and average house prices increasing. Also updating with positives is easyJet, announcing a rise in June passenger numbers – although with subsequent terrorist actions since these were correlated, they will be swiftly ignored by the markets.