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Wednesday was marked by further volatility, with global focus once again resting on Greece and George Papandreou’s bid to force further austerity measures through a somewhat hostile parliament. Equity markets were up across Europe in anticipation of a successful outcome for the embattled prime minister.
As violent protests erupted between rioters and police, the highly unpopular €28bn package, as insisted by the EU and IMF, was passed by a margin of 155-138 votes. Surprisingly, markets actually lost ground following the announcement of the successful outcome, suggesting much of the news was already priced in. Commentators have suggested that the comfortable majority bodes well for further votes which are necessary to detail the measures, particularly relating to privatisation, on Thursday.
The Euro matched equity market volatility, dropping significantly on news that one of the ruling PASOK party members voted against the package. It rebounded following announcement of the outcome to finish the 0.45% higher against the dollar.
The FTSE 100 ended the day with a 1.5% gain of 89 points, closing at 5855, its highest level for 3 weeks. Topping the leader board was interdealer firm ICAP, whose shares rose by over 9.5%, closing 42.3p higher at 478.8p. The shares were already 6.5% higher by the time the group announced changes to the management team of its currency trading division and analysts suggested a resolution in Greece would make markets more active, boosting ICAP’s earnings.
Locally, Panmure Gordon has downgraded its view on Bellway on valuation grounds, the broker cited recent share price performance, up 40% since November last year, and suggested the rise was potentially overdone if the troubles being seen on the high street translated into patchy housing throughout the remainder of the year. Shares in Bellway fell 16p to 707p on the news.
This was posted in Bdaily's Members' News section by John Dance .
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