Greek news outlets reported early Wednesday that Prime Minister George Papandreou had won unanimous support from his cabinet for his proposed referendum. However, several lawmakers in the governing Socialist Party rejected his plan, raising the possibility that he will not survive a no-confidence vote Friday.
Chancellor Angela Merkel of Germany and President Nicolas Sarkozy of France were planning emergency talks on Greece later Wednesday with euro-zone leaders in Cannes, on the eve of the Group of 20 nations summit meeting.
In early trading, the Euro Stoxx 50 index, a barometer of euro zone blue chips, rose 1.3 percent, while the FTSE 100 index in London gained 0.7 percent. On Tuesday, global markets tumbled after Mr. Papandreou made his surprise referendum announcement.
Industrial and banking shares led European indexes higher, with the mining giants Rio Tinto and BHP Billiton both up more than 2 percent. The French bank BNP Paribas rose 5.3 percent, and HSBC Holdings, the largest British lender, gained 1.3 percent.
Trading in Standard Poor’s 500 index futures suggested Wall Street would open the day on a positive note. The S. P. 500 fell 2.8 percent Tuesday.
“Markets are seriously pondering a disorderly default in Greece and risk assets are tanking,” said analysts at Crédit Agricole CIB in a note to clients. “There is little prospect of any turnaround today unless officials can pull a rabbit out of the hat today, but even the rabbit is likely to remain elusive.”
The analysts also said that investor sentiment was also hurt by weaker-than-expected Chinese manufacturing data released Tuesday.
Asian shares were mixed. The Tokyo benchmark Nikkei 225 stock average fell 2.2 percent. The Sydney market index S. P./ASX 200 fell 1.1 percent. In Shanghai the composite index rose 1.4 percent, while the Hang Seng index in Hong Kong closed 1.9 percent higher.
The dollar fell against other major currencies. The euro rose to $1.3768 from $1.3703 late Tuesday in New York, while the British pound rose to $1.6006 from $1.5949.
The dollar fell to 78.11 yen from 78.37 yen, and to 0.8840 Swiss franc from 0.8871 franc.
Still, the currency market is likely to remain jumpy, analysts at Crédit Agricole C.I.B. wrote, as worries over Mr. Papandreou’s proposed referendum will probably persist for some time.
“The fact that this referendum may not take place until January will bring about a prolonged period of uncertainty and further downside risks for the euro against the U.S. dollar,” they said.
U.S. crude oil futures for December delivery rose 0.9 percent to $93.05 a barrel. Comex gold futures rose 0.8 percent to $1,711.80 an ounce.
Kevin Drew reported from Hong Kong. Sei Chong contributed from Hong Kong and Rachel Donadio from Athens.
Article source: http://feeds.nytimes.com/click.phdo?i=be60ca9dc36a4df5ced7d8cc668df144
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