Home Associations Daily Overview of Global Markets & the SEE Region (Tuesday, October 6, 2015)

Daily Overview of Global Markets & the SEE Region (Tuesday, October 6, 2015)

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Dr. Platon Monokroussos,  Chief Market Economist, Deputy General Manager, Eurobank Ergasias S.A

Dr. Platon Monokroussos, Chief Market Economist, Deputy General Manager, Eurobank Ergasias S.A

HIGHLIGHTS

WORLD ECONOMIC & MARKET DEVELOPMENTS

GLOBAL MARKETS: Wall Street closed in the black overnight with energy equity shares registering the biggest gains, after Friday’s US disappointing payrolls report prompted a dovish shift in FOMC rate hike expectations. Trailing Wall Street gains, most Asian bourses were firmer on Tuesday, poised to register their best five-day performance since 2011. In FX markets, the USD edged higher in European trade on Tuesday favored by the improved tone in global equity markets. Given last week’s poor employment-related data, market focus is on Fed Esther George who is scheduled to speak in Chicago later today, for hints over the timing of the first fed funds interest rate hike. Separately, ECB President Mario Draghi delivers a speech in Frankfurt later today, which will likely also be scrutinized by market participants.

GREECE: In their meeting yesterday, euro area finance ministers endorsed the first set of milestones –as it was agreed at last week’s Euro Working Group- that is required to be fulfilled by the Greek side for the release of the €2bn installment out of the outstanding €3bn sub-tranche of the first loan disbursement, under the ESM loan facility./ As was planned, the Greek government submitted yesterday to the Hellenic Parliament the draft 2016 Budget based on the assumption of GDP contracting by 2.3% and 1.3% in 2015 and 2016 respectively, in line with the official forecasts.

SOUTH EASTERN EUROPE

CYPRUS: Quoting an unnamed Cypriot official, FT reported yesterday that Cyprus is planning to raise €1.5bn via the issuance of a new 10-year benchmark bond before year-end. Along these lines, Minister of Finance Harris Georgiadis confirmed that a new bond issuance is on the plans by the end of 2015 in line with the annual funding programme, but the exact timing and details have yet to be determined.

ROMANIA: Romania’s finance ministry sold at an auction on Monday the planned RON 100mn (€ 22.7mn) of July 2027 T-bonds, at an average accepted yield of 3.97%.

CESEE MARKETS: Emerging stock markets were treading water in early European trade on Tuesday, as their recent rally – instigated by scaled back expectations for a Fed rate hike in the near future – ran out of steam. Separately,  CESEE currenciesand government bonds were little changed on a daily basis in early European trade. In external debt markets,  the International Swaps and Derivatives Association, Inc. (ISDA) announced y-day that a credit event had occurred after Ukraine failed to meet its obligation to redeem $500mn of government debt that matured on September 23 by the end of a 10-day grace period.

Viewers can read the full report herebelow:

Daily Overview October 6 2015

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