Daily Overview of Global Markets & the SEE Region (Wednesday, June 08, 2016)

Banking, Company Profiles, Markets, News, Person Profiles, Reports, Statistics, Stock Markets — By on June 8, 2016 at 9:52 AM
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: Asian equity markets traded mixed on Wednesday, as weaker than expected exports in China overshadowed the increase in oil prices and trimmed expectations of an imminent Fed interest rate hike. Elsewhere, the German 10yr bond yield tested a record low of 0.033% earlier today mirroring its safe-haven appeal ahead of the UK’s referendum on EU membership on June 23rd. In FX markets, the USD remained under pressure against most of its currency peers following the disappointing US May’s employment report at the end of the previous week and Fed Chair Janet Yellen’s speech on Monday that wiped out expectations of a Fed rate hike in June.

GREECE: One of the open issues attached to the conclusion of the 1st programme review was fulfilled yesterday after the Hellenic Republic Asset Development Fund (HRADF) and the consortium represented by Lamda Development signed the MoU for the development of the previous Athens airport of Hellinikon. However, according to some press reports, two issues are still open: (i) establishment of legal immunity for the administration and the expert council of the new Privatization Fund; and (ii) the transfer of the State’s 5% stake in Hellenic Telecommunications Organization S.A. (OTE) to the HRADF. The Eurogroup Working Group is expected to convene on Thursday, June 9th to give the green light for the release of the next sub-tranche of €7.5bn, assuming that the Greek side will have fulfilled by then all remaining open issues.

SOUTH EASTERN EUROPE

BULGARIA: The revised estimate of the NSI on the seasonally adjusted Q1-2016 GDP reading confirmed the flash estimate of +0.7% QoQ/+2.9% YoY. The strong reading of Q1 comes against +0.7% QoQ/+3.0% YoY in Q4-2015 vs. +0.7% QoQ/+3.1% YoY in Q3-2015 and +0.9% QoQ/+2.9% YoY in Q1-2015.

CESEE MARKETS: Emerging stock markets remained in the black earlier on Wednesday, following positive import data from China. A further rise in oil prices also provided support. Separately, most regional currencies retained a firm tone, while government bonds were mixed. Focus today in primarily on the MPC meetings in Poland where the Central Bank is broadly anticipated to stay put on its monetary policy and maintain the key policy rate at the current record low level of 1.50%.

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Daily Overview June 8 2016

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