FTSE 100 preview: Greek uncertainty hurts sentiment

on Feb 12, 2015

Britain’s benchmark index is expected to open lower this morning as a seven-hour discussion in Brussels failed to find a solution for Greece’s debt debacle. Greek finance minister Yanis Varoufakis’ meeting with other eurozone leaders did not yield a deal yesterday. Talks will resume on Monday, as the deadline for a solution looms, with Greece’s current €240 billion bailout programme due to end on February 28.

The Footsie declined for a fourth day yesterday, closing 0.2 percent lower at 6,818, as investors scaled back their appetite for risk ahead of the pivotal meeting about Greece. Traders also had to keep an eye on geopolitical developments as France, Germany, Russia and Ukraine began peace talks in Belarus as pro-Moscow separatists tightened the pressure on Ukraine in some of the war’s worst fighting.

According to trading platform IG, the FTSE 100 will start today’s session eight points down at 6,810, with Investors eyeing several corporate releases. Pharmaceutical company Shire (LON:SHP) and miner Rio Tinto (LON:RIO) are scheduled to post their full-year results, while cigarettes maker Imperial Tobacco (LON:IMT) and SSE (LON:SSE), one of the UK’s ‘Big Six’ energy companies, will update on their quarterly performance.

Elsewhere, US stocks closed narrowly mixed yesterday, as investors continued to watch for developments in the negotiations between Greece and eurozone finance ministers. The Dow Jones Industrial Average closed down 0.04 percent, or 6.62 points, at 17,862.14, while the S&P 500 was unchanged at 2,068.53. The Nasdaq ended the session 0.28 percent, or 13.54 points, better off at 4,801.18.
Asian stock markets have also been subdued amid the ongoing uncertainty over Greece’s debt crisis. By 06:29 GMT today, the MSCI’s broadest index of Asia-Pacific shares outside Japan had declined 0.31 percent, or 1.81 points, to 575.26, on a broad decline in markets from Australia to China. Japan’s Nikkei 225 bucked the trend, underpinned by a significantly weaker yen. As of 06:32 GMT, Tokyo’s benchmark index was 1.85 percent, or 327.04 points, up at 17,979.72.

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