Richard Perry
Independent Analyst
The attention will turn back towards Greece again with the US taking its Independence Day public holiday. However the market is still digesting what was a rather disappointing Non-farm Payrolls report yesterday which has posed serious questions over the viability of a September rate hike now. This has stunted the confidence of the dollar bulls and put markets into a state of flux once more. The focus will now shift to the Greek referendum which will be held on Sunday. The IMF has also through the cat amongst the pigeons for the creditors with the publishing of a report that suggests the Greeks need a further bailout and also a restructuring of its debt obligations. This plays into the hands of Greek Prime Minister Tsipras who has been urging his country to vote “No” in the election which is over whether to accept the bailout proposals (incidentally for a bailout that no longer exists).
Markets have been fairly muted to the reaction of the payrolls report and the upcoming Greek referendum, with Wall Street closing all but flat overnight and markets in Asia also broadly flat (apart from China which continues to swing with wild volatility on a daily and sometimes intraday basis). European markets have opened in cautious mode on a day where the US is shut for Independence Day.
Forex markets are mixed coming into European trading with little real direction after the Payrolls report curtailed the bull run for the dollar yesterday. The gold price has also found some support too.
Traders will be looking at the services PMIs across the Eurozone very early in the session, whilst the UK data is at 0930BST and is expected to pick up to 57.4 from the sharp dip to 56.5 that was seen last month.
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