Global Conflict Affects Markets
US stock futures declined as investors digested the possibility of a Greek exit from the euro zone.
Monday, February 9, 2015 - 00:00
Meanwhile, Russian officials warned the US against providing arms to Ukraine which could only worsen the conflict there.
Greece’s Prime Minister Alexis Tsipras renewed fears of a Grexit (a Greek exit form the EU) after underscoring his initial promise against the nation’s bailout, according to Bloomberg. Tsipras pledged to work toward an end to austerity, which might lead to confrontation with international creditors.
As a result, futures indices showed the US market could open lower Monday after last week’s strong performance. The S&P 500 added 3% last week – its strongest increase in almost two months. Futures contracts on the S&P 500 dropped 0.5% on Monday. Futures for the Dow lost 0.5% as well.
“We had the earnings season and that is done and dusted, and now it’s Europe that may step in with noise about the negotiations about Greece and about Ukraine,” Christian Gattiker, head of research at Julius Baer Group Ltd. in Zurich, told Bloomberg. “All the Greece debate and the uncertainty about the euro zone is certainly not good news for global sentiment.”
West considers Ukraine options
American and European leaders are working to provide a united front in alliance with Ukraine against Russian incursion, according to The Wall Street Journal. However, the US and Germany differ on exactly how to offer that support.
Russian President Vladimir Putin is expected to provide a course of action on Wednesday that would outline how and when to end fighting in Ukraine, initiated by German Chancellor Angela Merkel. If Putin does not comply, Germany will increase sanctions against Russian companies.
On the other hand, the US is weighing the possibility of providing Ukraine with more arms. President Barack Obama has not come to a decision. While Germany opposes such a move, other European countries like Lithuania believe it is the right move. Russia still denies any involvement in the conflict by way of ground support, but US and EU officials point to evidence to the contrary.
In either case, the market – particularly those in Europe – will likely be influenced. Investors would be wise to keep an eye on Greece and Ukraine as they make decision moving forward.
Binary options guard against geopolitical strife
When political turmoil threatens peace and or economic stability, markets can become volatile. That’s when investors should consider trading binary options through Nadex. These short-term, limited-risk contracts allow investors to trade on nearly any market without fear of getting stopped out or losing more than their initial collateral.
This information has been prepared by Nadex, a trading name of North American Derivatives Exchange, Inc., prepared by independent third parties contracted by Nadex or reproduced form third party news agencies. In addition to the disclaimer below, the material on this page does not contain an offer of, or solicitation for, a transaction in any financial instrument. Nadex accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication.