“Soon though, investors in New York and Beijing will be thinking about more local issues such as the prospect of a Fed rate hike in September and further rate cuts in China. These decisions are more likely to have a profound impact on equities than the concluding chapter of a well-documented Greek default,” Rossi added.
“The images of queues at ATMs in Greece are stripping traders of what little confidence they have left in the nation, and the financial earthquake that happened in the eurozone over the weekend can be felt around the world,” said IG market analyst David Madden.
“Of all the market sell-offs we have witnessed due to Greece this one is the worst in years, and traders who thought a Greek exit wasn’t on the cards are quickly reassessing their point of view,” Madden added. “The hard left-wing Syriza has met its match, and the creditors have returned a swift serve to the Athens administration, which has prevented Greek banks from opening this week. The referendum that is due to take place in Greece at the weekend will be the sink or swim moment; either the Greek people fall in line with austerity or jump and go it alone.”
