Good Morning.
The Eurozone finance ministers meeting ended with a “Nothing Done”. Jean Claude Junker said that Greece has made progress on its debt bailout targets but eurozone finance ministers will have to meet again on November 20 to clear the way for its next aid tranche.
An extraordinary meeting will be hold on November 20 aiming to tie down the last details to allow payment to Athens of some 31 billion euros in urgently needed funds. Junker concluded that there would be no problem with Athens rolling over debt due on the 16th. The Greek Prime Minister Antonis Samaras had a different opinion when he said that his country would go broke by Friday if Monday's meeting failed to produce the aid payment.
European Economic Affairs Commissioner Olli Rehn said “there is a solution,” explaining that Greek banks will be able to take part in a government sale of treasury bills that day, providing the money Athens needs to cover the debt.
Finance ministers agreed that revised fiscal targets ” as requested by the Greek government and supported by the troika, would be an appropriate adjustment”. Athens wants its current 240 billion euros bailout accord running to 2014 to be extended to 2016, giving it more time to meet the targets which have been torpedoed by a much deeper economic slump than expected.
The common currency reacted to the news falling 0.20% to 1.2685$. Uncertainty over Greece together with deteriorating business confidence in Australia and a report on China to expand a property tax trial weighted on Asian benchmarks.
Australia's S&P/ASX 200 dropped 1.53%, China's Shanghai Composite Index skidded 1.23%, Hong Kong's Hang Seng Index fell 0.87%. The Nikkei Stock Average gave back early gains to trade 0.41% lower to 8,640.84 as the country's weak economic outlook, pressured sentiment; South Korea's Kospi followed the Nikkei's path sliding 0.80%.
Reflecting the risk aversion during the Asian session US crude futures fell 0.4% to $85.20 a barrel and Brent dropped 0.4 percent to $108.60. London copper eased 0.3 percent to $7,618.75 a ton and gold inched down 0.2 percent to $1,723.44 an ounce, having failed to test last week's high around $1,738, as the dollar strength weighted on the yellow metal.
The disappointment could weight on the opening bell in Europe, although according to us, the outcome of the EU finance ministers summit was largely expected. Investors will be waiting for the German Zew Economic Sentiment expected at -9.8 versus -11.5 at previous reading at 10.00 GMT before loading their guns after Mr Draghi last week comments underlying our hypothesis that Germany lost its “Safe Haven” status in between Europe.
Originally posted at www.77sigmatrading.com
