Market Review - 07/07/2015 20:20GMT
Euro tumbles on speculation of 'Grexit' before rebounding strongly
The single currency ratcheted lower on Tuesday on speculation of 'Grexit' together with the selloff in global equities. Euro penetrated 1.0955 support and then tumbled to a low of 1.0916/17 before rebounding strongly near New York close due to the rise in Dow Jones index. Dow Jones index fell by more than 200 points in early trade before paring all the losses and closed up 93 points.
Greek government official said 'PM Tsipras will address European parliament on Wednesday.' European Commission President Jean-Claude Juncker said Grexit should be avoided; says throwing Greece out of monetary union or EU is not something we want.
EU's Dijsselbloem said 'Eurogroup to hold conference call tommorrow to discuss Greek ESM request; Eurogroup to discuss medium-term ESM programme for Greece; Eurogroup awaiting new Greek letter with one clear set of proposals; ECB to assess the situation in Greece on a day to day basis.'
Ireland's finance minister said euro zone finance ministers are open to the idea of "reprofiling" some of Greece's sovereign debt, but details of any new bailout would need to be in place by next Monday. Senior EU source said tentative plan for another eurozone summit on Sunday to approve any plan to aid Greece.
On the data front, U.S. trade deficit widened by $1.2 billion to $41.9 billion in May, slightly less than the economists' forecast of $42.6 billion, due to concerns over weak overseas demand and a strong U.S. dollar. Market players are expecting economists may slightly raise their forecasts for economic growth in the second quarter.
Despite dollar's brief bounce to 122.88 on Tuesday, renewed selling below Monday's 122.93 high knocked price lower. Dollar nose-dived to 122.00/01 on renewed risk aversion due to the selloff in global equities before rebounding on short-covering due to the rise in U.S. stock markets.
The British pound met renewed selling at 1.5605 at European open due to the selloff in European equities. Cable nose-dived to as low as 1.5413 in New York morning before rebounding on active short-covering.
Wednesday will see the release of U.K. BRC Shop Price Index, Japan's Current Account, Economy Watchers Poll, U.K. Budget Report, Canada's Building Permits and U.S. FOMC Minutes.
Euro tumbles on speculation of 'Grexit' before rebounding strongly
The single currency ratcheted lower on Tuesday on speculation of 'Grexit' together with the selloff in global equities. Euro penetrated 1.0955 support and then tumbled to a low of 1.0916/17 before rebounding strongly near New York close due to the rise in Dow Jones index. Dow Jones index fell by more than 200 points in early trade before paring all the losses and closed up 93 points.
Greek government official said 'PM Tsipras will address European parliament on Wednesday.' European Commission President Jean-Claude Juncker said Grexit should be avoided; says throwing Greece out of monetary union or EU is not something we want.
EU's Dijsselbloem said 'Eurogroup to hold conference call tommorrow to discuss Greek ESM request; Eurogroup to discuss medium-term ESM programme for Greece; Eurogroup awaiting new Greek letter with one clear set of proposals; ECB to assess the situation in Greece on a day to day basis.'
Ireland's finance minister said euro zone finance ministers are open to the idea of "reprofiling" some of Greece's sovereign debt, but details of any new bailout would need to be in place by next Monday. Senior EU source said tentative plan for another eurozone summit on Sunday to approve any plan to aid Greece.
On the data front, U.S. trade deficit widened by $1.2 billion to $41.9 billion in May, slightly less than the economists' forecast of $42.6 billion, due to concerns over weak overseas demand and a strong U.S. dollar. Market players are expecting economists may slightly raise their forecasts for economic growth in the second quarter.
Despite dollar's brief bounce to 122.88 on Tuesday, renewed selling below Monday's 122.93 high knocked price lower. Dollar nose-dived to 122.00/01 on renewed risk aversion due to the selloff in global equities before rebounding on short-covering due to the rise in U.S. stock markets.
The British pound met renewed selling at 1.5605 at European open due to the selloff in European equities. Cable nose-dived to as low as 1.5413 in New York morning before rebounding on active short-covering.
Wednesday will see the release of U.K. BRC Shop Price Index, Japan's Current Account, Economy Watchers Poll, U.K. Budget Report, Canada's Building Permits and U.S. FOMC Minutes.
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