EUROCORP

Financial Morning News 23/05/2012

GREEK FINANCIAL MARKET

The General Index in Athens Stock Exchange (ASE) closed at 535.96 posting losses of 1.58%, recording new lows, in a turnover of €42.80mn.

According to OECD, GDP will contract 5.3% this year and 1.3% in 2013, after shrinking 6.9% in 2011, whereas the European Commission forecasted that the Greek economy will contract 4.7% this year and show zero growth in 2013 with an analysis published on the 11th of May.

The U.S. President, Mr. Barack Obama urged Europe to strengthen its defences against financial market turmoil and recapitalize its banks as part of a four-pronged strategy for tackling the euro zone crisis, accepting that the situation in Greece has an impact on the U.S. economy (Reuters).

The ECB Vice President Mr. Vitor Constancio said that he does not expect Greece would exit the euro and urged Athens to work with Europe to remove the risk of its crisis spreading to other countries.

The IMF managing director Christine Lagarde said that the IMF expects Greece΄s next government to implement its agreed bailout program.

The Austrian Finance Minister, Mrs. Maria Fekter reported concerning the possibility of Greece returning to drachma that currency devaluation may strengthen Greece΄s competitiveness in the short run, but there is no way around structural reforms that make growth possible in the first place.

The South Korea’s President, Mr. Lee Myung-bak said that Greece needs to accept the terms of a $130bn international bailout agreed in March and there will be no disbursement of money from the IMF, unless the country does so.

Corporate Impacts

  • Banks: a) A senior Greek banker said that the four largest commercial banks will receive €18bn recapitalization funds by Friday b) The banking system is being propped up by an estimated €100bn of emergency liquidity provided by BoG and approved secretly by the ECB. If Greece were to leave the eurozone, the immediate cause might be an ECB decision to pull the plug (Financial Times).
  • Alpha Bank: a) The Second Iterative Extraordinary General Meeting approved yesterday the cessation of merger procedure with Eurobank.
  • Technical

      • FTSE 20 June future: Support levels: 192-186-180. Resistance levels: 206-214-220.

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