Global shares, euro fall as Greek deal proves elu­sive

The Pak Banker - - Front Page -


Euro­pean shares and the euro fell on Wed­nes­day af­ter Greece's in­ter­na­tional lenders failed to reached a deal to re­duce the coun­try's debt and re­lease the next pay­ment from its bailout.

The euro was down 0.5 per­cent at $1.2752, while the re­gion's blue chip Euro STOXX 50 in­dex ended two days of gains built on ex­pec­ta­tions of a Greek deal to fall 0.3 per­cent to 2,501.25 points (.EU)

Euro zone fi­nance min­is­ters, the In­ter­na­tional Mone­tary Fund and the Euro­pean Cen­tral Bank will gather again on Mon­day af­ter nearly 12 hours of talks through the night failed to reach a con­sen­sus on how to bring Greece's debt down.

"Mar­kets had be­lieved the min­is­ters would agree on aid for Greece at (the) meet­ing," said Yuji Saito, di­rec­tor of for­eign ex­change at Credit Agri­cole in Tokyo. "In­stead, a set­tle­ment is post­poned, high­light­ing the dif­fi­culty of get­ting con­sen­sus on the debt cri­sis. But I feel this is a typ­i­cal Euro­pean po­lit­i­cal show and an agree­ment will be reached."

The euro's de­cline and a weaker Ja­panese yen lifted the dol­lar by 0.3 per­cent against a bas­ket of key cur­ren­cies (.DXY) and weighed on com­modi­ties such as gold, which fell 0.25 per­cent to $1,723.40 an ounce. The de­lay boosted de­mand for safe haven Ger­man gov­ern­ment bonds, bod­ing well for an auc­tion of new 10-year debt later in the day and send­ing the main Bund fu­tures con­tract up 23 ticks to 141.61.

Gains in world eq­uity mar­kets had al­ready stalled be­fore the Greek de­lay af­ter a warn­ing by Fed­eral Re­serve Chair­man Ben Ber­nanke on Tues­day that the cen­tral bank lacked the tools to cush­ion the im­pact of a po­ten­tial U.S. fis­cal cri­sis.

US stock fu­tures were 0.25 per­cent lower in Euro­pean trade, point­ing to a weak Wall Street open for its last ses­sion be­fore the Thanks­giv­ing Day hol­i­day.

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