GREECE: Positive market reactions after election results

The initial reaction of the international markets after the recent election result in Greece was positive, as Greece moves away from the worst case scenario of leaving the Euro zone, which had already been assessed.

Even though the so-called "Grexit" can still be considered inevitable for Greece, Election winner party NEW DEMOCRACY is the one to lift the broader risk.

Technically, the rise of markets confirms the predictions for strengthening the euro to the 1.2800 - 1.3000 dollar area before the formation of the next medium-term lower peak will lead to further losses.

At present, the election results help to deliver the upward momentum and attention turns to tomorrow's meeting of G20 and spreads of Spanish and Italian bonds.

Also, support for risk appetite reports gave the UK Telegraph and the New York Times talking about the official EU plan to tackle the problems of the Eurozone. One of the biggest criticisms is the lack of strong leadership in the EU and will for the creation of an official plan.

At this point, it seems that the fall of the euro in recent weeks below the 1.2300 dollars can be an expectation for the worst scenario in Greece an the peripheral Euro zone countries.

Therefore, the subsequent rally is removing this risk cathode. It also means that the market does not support a stronger risk investment environment and when the factor of the Greek elections will disappear then the risk aversion will come back.

Related articles

HUNGARY: NBH fears the Szell Kalman Plan 2.0 could lead to higher inflation and may increase the "black economy"

The Monetary Council of Hungary's central bank (NBH) has voted on April 24th to leave the key policy rate unchanged at 7.00%. Thus, it will be the fourth consecutive month when the indicator's value is kept at this level, asthe high volatility of risk perceptions and recent trends in underlying inflation continue to warrant a cautious policy stance. One of the main reasons of concern for the MC's members is the possible inflationary trend generated by the measures recently announced by the government with the Szell Kalman Plan 2.0.

2012-04-26

ON THE MOVE

TOP EVENT

The 9th International Istanbul Insurance Conference started today in Istanbul

In emerging markets like Turkey, there can be a significant difference between the insured and total insurable losses. Parametric insurance is a smart way to close this protection gap. While the traditional products cover an insured loss, parametric products provide financial protection for various expenses from financial liabilities to contingent loss of profit which, in return, decreases the economic loss burden following a CAT event.

04.10.2017

61st "Rendez-Vous de Septembre" ends today in Monte Carlo: review

The 61st edition of the "Rendez-Vous de Septembre", the annual traditional meeting of reinsurers ends today in Monte Carlo. The Nat Cat insurance protection gap, as well as the global insurance market readiness to deal with the increasing complexity of the cyber risks were among the most debated topics.

14.09.2017

See all