With the vote from the Greek parliament pending and due any minute now, the markets are still jittery yet rather optimistic over the possibility for Greece to avoid default as the parliament is likely to pass the austerity package.
The focus remains on Europe and debt-laden Greece as the next chapter for global financial markets and for the path of the recovery will be determined whether Greece will be allowed to default or stability will return gradually with the flow of bailout funds once again.
With the uncertainty still surrounding the vote, news reports are quoting more opposition members crossing the line to the yes camp and the positive news is supporting the bearish reversal across the board for currencies, stocks and commodities and keeping the dollar gains at bay!
The dollar index extended the downside move for the third day, and leaving the week's high at Monday's opening session of 75.98 and traded bearishly today as well to the low of 74.67 from the high of 75.13 and currently around 74.77.
We can see the upbeat news going well for sure for the shared currency as the euro extends the gains versus its major counterparts. The EUR/USD continued the upside move to the high of 1.4447 from the early low recorded at 1.4336 and currently around 1.4415 as the pair attempts to maintain the positivity with the stable trading above 1.4300 areas.
The euro also continued the gains versus the swiss franc to recover from the new record low reached. The EUR/CHF is still resuming the upside trend and currently around 1.2027 from the morning low of 1.1922 and recorded the highest so far at 1.2058. Versus the Japanese yen the same scenario goes and the favors are all euro biased! The EUR/JPY moved higher to set 117.16 from the earlier low of 116.14 recovering from the week's opening lows of 113.19 on Monday.
The positivity was reflected across the board in Europe with equities trending higher, as the STOXX 50 trades higher with 1.94% at 2803.86 at the time green covers major markets with FTSE 100 adding 1.40% to 5847.41, CAC 40 higher by 1.75% at 3919.41 and DAX 30 trading at 7295.06 higher by 1.73%.
Greek stocks were also trading in the green in anticipation of a positive vote and ignoring the violent protests and riots across Athens since yesterday, with the transportation minimally operating under the 48-hour general strike called. The Athex Composite is trading higher now by 2.85% at 1294.67.
Commodities were also bolstered by the positive sentiment with the gains covering the sectors. WTI Crude for August is higher by almost 1.0% at $93.83 while Gold added 0.39% to trade at $1507.55 on the back of rising commodities and the weak dollar, as the metal's gains were still kept short amid the rally in confidence, especially when compared to silver's 1.43% rally to $34.31 an ounce.
It is only a matter of a little more waiting as the vote is expected anytime now and the market is already pricing the good of it! It is mostly positive with the opposition changing sides and reaching the conviction that there is indeed NO PLAN B for Greece. The odds are for a positive vote yet and accordingly we expect the optimism to prevail with U.S. markets opening to the upbeat vibe, and at the current market sentiment a surprise NAY vote will indeed be catastrophic with at least 10% losses across the board!!!