Indices unbalanced over Greek drama

Heading into the close the FTSE 100 is down 10 points, while eurozone markets suffer a renewed round of Greek crisis fatigue. 

London
Source: Bloomberg

Markets favour Greece's creditors

Welcome to day three of the interminable Greek drama. Just when we thought the crisis couldn’t become more trying, the endless series of headlines is making investors even wearier with a problem that just won’t go away. No sooner does a headline appear than it is swiftly denied. The net result is that we have seen see-saw action across indices, especially in Europe, but with markets ending the day in the red it looks like people are still preferring to believe the eurozone and Greece’s creditors, rather than the government in Athens.

A big loser on the FTSE 100 during the day was equipment hire firm Ashtead Group, which slumped by over 3% following a report from US peer United Rentals, whose shares fell over 6% after it said that May activity was particularly weak. Ashtead’s success, rising over tenfold since 2010, has been built on the strength of its US operations, and while the news does not dent the upward trend, it will cause some investors to wonder whether the shares are still compelling value at around 20 times earnings.

Amazon faces stiff competition

It was a day dominated by moves from the internet giants Amazon and Google. The latter will be doing its best to burn some more holes in everyone's wallets by introducing a ‘buy it now’ button to search results, the better to encourage impulse purchases and increase the attraction of the search engine giant as a one-stop shop for everyone’s needs.

Meanwhile Amazon has taken just 24 hours to strike back at Wal-Mart’s new ‘Shipping Pass’, designed as a challenger to Amazon’s Prime service, with expanded same-day delivery. Amazon has always been keen to stifle competition as quickly as possible, but it has never really taken on a firm of Wal-Mart’s size before. This battle between two titans will be one to watch.

US economic data continues to tend towards the good end of the spectrum, with pending home sales strong and only a modest increase in initial jobless claims. It appears that Q2 will be much better than Q1, lending force to the idea that a rate hike by the Federal Reserve is on its way later in the year.

Oil continues to struggle

Declines in oil prices are threatening to turn into a rout, as the commodity endures yet another down day. Hopes have been dashed that OPEC will take any action at its meeting next week, and having seen the price rally hard over the course of 2015 so far, the cartel’s members will be even more disinclined to cut output than they were at the last general get-together.

Supply is slowing, as is capital expenditure, but it will have to stay on this trend for months to come to really eat away at the vast overhang that has been built up.

Dollar strong against yen

It has been a tough day for sterling after UK GDP revisions failed to live up to their billing. There was no upward revision to growth, the number having been expected to rise to 0.4% from 0.3%, with a downward revision to service sector growth offsetting improvement in other areas.

Investors duly reworked their expectations on a UK rate hike, and then found reasons to buy the US dollar once again. The dollar continues to motor on against the yen, as markets once again woke up to the stark divergence in monetary policy between the Fed and the Bank of Japan. 

Denne informasjonen er utarbeidet av IG, forretningsnavnet til IG Markets Limited. I tillegg til disclaimeren nedenfor, inneholder ikke denne siden oversikt over kurser, eller tilbud om, eller oppfordring til, en transaksjon i noe finansielt instrument. IG påtar seg intet ansvar for handlinger basert på disse kommentarene og for eventuelle konsekvenser som et resultat av dette. Ingen garanti gis for nøyaktigheten eller fullstendigheten av denne informasjonen. Personer som handler ut i fra denne informasjonen gjør det på egen risiko. Forskning gitt her tar ikke hensyn til spesifikke investeringsmål, finansiell situasjon og behov som angår den enkelte person som mottar dette. Denne informasjonen er ikke utarbeidet i samsvar med regelverket for investeringsanalyser, så derfor er denne informasjonen ansett å være markedsføringsmateriale. Selv om vi ikke er hindret i å handle i forkant av våre anbefalinger, ønsker vi ikke å dra nytte av dem før de blir levert til våre kunder. Se fullstendig disclaimer og kvartalsvis oppsummering.

Finn artikler av analytikere

Denne informasjonen er utarbeidet av IG, forretningsnavnet til IG Markets Limited. I tillegg til disclaimeren nedenfor, inneholder ikke denne siden oversikt over kurser, eller tilbud om, eller oppfordring til, en transaksjon i noe finansielt instrument. IG påtar seg intet ansvar for handlinger basert på disse kommentarene og for eventuelle konsekvenser som et resultat av dette. Ingen garanti gis for nøyaktigheten eller fullstendigheten av denne informasjonen. Personer som handler ut i fra denne informasjonen gjør det på egen risiko. Forskning gitt her tar ikke hensyn til spesifikke investeringsmål, finansiell situasjon og behov som angår den enkelte person som mottar dette. Det er ikke utarbeidet i samsvar med lovens krav for å fremme uavhengighet av investeringsanalyse og som sådan er ansett av å være markedsføringskommunikasjon. Selv om vi ikke er hindret i å handle i forkant av våre anbefalinger, ønsker vi ikke å dra nytte av dem før de blir levert til våre kunder.