Measures of volatility spiked.
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“A “No” vote is a decisive step toward a better agreement that we aim to sign right after Sunday’s result”, Tspiras said, rejecting repeated warnings from European partners that the referendum would effectively be a vote on whether Greece stays in the euro or returns to the drachma.
Working out a strategy for Greece’s debt burden, which stands at around 180 percent of the country’s annual GDP, is becoming a key discussion point ahead of Sunday’s referendum on creditor proposals.
Investors bought at the opening of trading after a Labor Department report on job creation suggested the economy was improving, though not so fast as to raise the specter of inflation and higher interest rates. “This isn’t about Greece; it’s what happens next”. The poll was conducted by ProRata, which surveyed 1,200 people June 28-29 with a margin of error of 2.8 percent.
At 13:34 a.m. EDT (1734 GMT) the Dow Jones industrial average was down 46.64 points, or 0.26 percent, at 17,711.27, the S&P 500 was down 3.67 points, or 0.18 percent, at 2,073.75 and the Nasdaq Composite was down 16.09 points, or 0.32 percent, at 4,997.03.
At the half-year mark, the S&P is 0.2% higher, while the Dow is 1.1% lower.
Western Union (WU.N), the S&P’s biggest percentage loser, fell 6.9% after Evercore ISI cut its rating on the stock to “hold” from “buy”, citing the Xoom deal. Germany’s DAX climbed 2.2 percent and the U.K.’s FTSE 100 index of leading European shares was 1.3 percent higher. Greece’s stock market was closed. The US dollar index was up 0.08 per cent at 95.568, having bounced from Tuesday’s low of 94.847.
Over the weekend, the European Central Bank refused to extend its emergency support for Greece’s banking system.
“Not only will I have to queue for hours at the bank in the hope of getting 120 euros, but I’ll have a two-hour round trip”, said Dimitris Danaos, 77, a retired local government worker who was making the bus journey from his home outside the Greek capital to the suburb of Glyfada. Pictures of long lines at bank machines in Athens appeared on television screens around the world.
Dramatic headlines out of Greece have overshadowed USA data so far this week.
Several governments, particularly in Ireland, Portugal and Spain, are watching developments in Greece nervously on worries that a Greek default or Grexit will strengthen anti-austerity and anti-euro parties and movements in their own countries.
An S&P Capital IQ analysis of the last 70 years of market shocks shows that the US stock market tends to weather most storms that come its way. With the drop, the index fell to a three-month closing low.
The IMF said Greece had asked for a last-minute repayment extension earlier on Tuesday, which the Fund’s board would consider “in due course”. The agency says it now sees a 50-percent chance of Greece dropping the currency.
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A few years ago this would not have been the case, given extensive commercial lending exposures to the Greek government. Things have changed since then. Economists had expected an increase of about 220,000 jobs. “The Greek standoff will be disconcerting to financial markets, but only temporarily”. Bond prices fell, pushing the yield on the benchmark 10-year Treasury note up to 2.42 percent from 2.35 percent on Tuesday, a large move.
