15 Feb 2012: Eurozone threatens Greece aid

FTSE 100 5914 Up 25bp
S&P 500 1350 Down 9bp
NIFTY 50 India 5531 Up 214bp

Major Stories

  • Eurozone threatens Greece aid
    • While an agreement had been signed earlier, Eurozone are uncertain about bailing out Greece at this point due to 2 main reasons:
      • Greece haven’t committed if they will continue with the austerity measures when a new Govt comes into power in April- the probable new PM has ‘vowed to renegotiate deal’, meaning Eurozone is uncertain if austerity measures will continue to be implemented
      • The trust factor is suffering because Greece did not fulfil their promises after the first bailout
  • The European Commission’s head, Olli Rehn, has warned of the disastrous consequences of a default, and has pleaded for the bailout to go ahead
  • Most AAA rated Eurozone countries are certain that Greece will not fulfil its promises and are prompting a default
  • These countries’ leaders say that Europe is much more ‘prepared’ for a default, should it happen
  • China to unveil deal with Hollywood
    • China is set to unveil a joint venture between Dreamworks Animation and two Chinese media firms,  Shanghai Media Group, and China Media Capital
    • The companies will construct a studio in Shanghai with the aim of developing films, television productions
    • As film business is booming in China, and declining in USA, this is probably a very good tie-up for Dreamworks Animation; China’s box office receipts touched $2bn in 2011
  • Markets
    • Euro against Dollar, currently at $1.3148 per Euro
    • Stocks: FTSE 100 is up 0.3%- HSBC the biggest gainer with 2.8%, with banking gaining 1.2%; Tokyo’s Nikkei 250 is up 2.3%; FTSE Eurofirst 300 is up 0.84%
    • Debt: US 10-year demands decreased very slightly, pushing the yield up to 2.09% now
    • Commodities: Gold is at $1725/ounce; Brent Crude is at $117.97/barrel

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