The potential for a temporary agreement on funding Greece’s debt is likely to see the stock market open on a firm note this morning. The extent of investor enthusiasm towards the news on Greek debt may be limited by its temporary nature and ongoing uncertainty. The next hurdle comes as soon as tomorrow when European Finance Ministers will adjudicate on the economic measures Greece is proposing. Markets have also been pretty positive leading into Friday’s announcement indicating that investors had already been willing to largely discount the risk to financial stability from the Greek situation.
Investor attitude to the large cap, yield stocks will hold the key to the near term direction of the ASX 200 index. Buying momentum has slowed recently in some of the headline yield stocks like CBA; Telstra and Transurban. Ongoing consolidation in these stocks would see the overall index struggle to push convincingly towards 6000 in the near future.
The resource sector looks set for a cautious open this morning with commodity markets generally closing last week on a soft note. Traders will be waiting on the conclusion of the New Year for more direction from the crucial Chinese market.For further comment from Ric Spooner please call 02 8221 2137.