The deicion commitee voted that a Credit Event has occured with respect to the Hellenic Republic.
"collective action clauses (CACs) to amend the terms of Greek law governed bonds issued by The Hellenic Republic such that the right of all holders of the Affected Bonds to receive payments has been reduced."
Markets didn't move much, the Dow sold off 30-40 points, EUR/USD largely unchanged after the notice.
FTSE 100 5887.49
Dow Jones IA 12922.02
GBP/USD 1.566
GBP/EUR 1.19
EUR/USD 1.311
USD/CHF 0.919
USD/JPY 82.5
Where do we go from here?
Firstly non farm pay rolls beat expectations on Friday, and this saw a dollar rally, with EUR/USD now around 1.311 . Further "optimistic" comments from the FOMC on Tuesday could be bullish for the dollar. Particularly mention of higher oil prices contributing to higher inflation could also reduce the probability of QE3 and support the dollar.
Will be interesting to see, if earnings match the trend of beaitng expectations (which has been a hallmark of this bull market since 2009) whether the dollar will rally with the Dow. Given we saw the Dow sell offf somewhat at the start of the week, I will be on the sidelines this week waiting to see if there will be any reaction to the ISDA announcement in european equity markets (which were closed when the news was announced on Friday evening) and any possible reaction on eurozone bond spreads (some analysts saying that attention may now focus on Spain).
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