Focus shifts to Greek referendum

Following yesterday’s almost inevitable default, attention now turns to the Greek referendum. 

A Greek flag atop a building
Source: Bloomberg

The slow motion train wreck that traders had been watching for weeks finally saw Greece default as the nation missed its €1.6 billion IMF payment. The big question now is what next? As Greece enters the third day in a row where capital controls are in place, tensions are being stretched to breaking point.

The IG binary on the Greek referendum this weekend is currently indicating a 72% chance of a ‘yes’ vote winning.

Momentarily glancing away from the Greek shambles, it is worth noting that we are due manufacturing PMI data from China, across Europe, the UK and the US today, all of which will give economists a better grasp of global economic health. In addition to this data we will also be blessed with a plethora of political commentary from the latest Eurogroup meeting, along with the latest Bank of England financial stability report and accompanying commentary from Governor Mark Carney.

Greene King’s revenue broke above the £1 billion level for the first time in the company’s history as better-than-expected full-year figures lifted the brewery firm by 1.36% in early trading.

There was awful news from Speedy Hire as the CEO stepped down following an aggressive reassessment of its ability to meet its full-year targets. Considering how positive institutional analysts had been on the firm the markets’ reaction has been aggressive, knocking a third off the value of the shares.

After last year’s pre-tax loss, the first for the company in 15 years, Tullow Oil looks to have bounced back in swift style following today’s announcement. The company upgraded its full-year targets due to better-than-expected results from its West African oil field, and the shares are up by almost 2% on the day.

After being dictated to by a Mediterranean country many would struggle to point to on a map, US traders took their destiny back into their own hands as they drove equities higher.

Once again the focus of this short week is back on economic data, with today’s manufacturing and ADP figures and tomorrow’s earlier-than-normal non-farm payroll figures set to see them through the long weekend.

Ahead of the open we expect the Dow Jones to start 95 points higher at 17,714.

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