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Markets yo-yo over Greece and ECB surprise

Thursday, November 03, 2011 - 01:42

Nov. 3 - Chaos over Greece's role in the euro zone battered equity markets and hit the euro on Thursday, before a surprise ECB interest rate cut gave them a boost. Hayley Platt reports.

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Doubts about Greece's role in the euro zone are causing market chaos. Stocks fell early at the prospect of a long wait for a referendum then recovered on hopes of an early election instead. By midday the FTSE 300 - Europe's leading share index - was trading up around 1/2 a percent. In Germany the DAX was up almost 1 1/4 percent and the French CAC was nearly one percent higher. Bertrand Lamielle is a trader based in Paris. (SOUNDBITE) (French) BERTRAND LAMIELLE, HEAD OF ASSET MANAGEMENT AT B-CAPITAL SAYING: "Globally it seems that the firm message sent out yesterday has had an effect on the market. If they had let Greece freely follow its own path without concern for the rest of Europe, it is very probable that the markets would have definitely plunged more into the red." Robert Halver, a Frankfurt-based trader said the markets were encouraged by some decision making - good or bad. (SOUNDBITE) (English) TRADER AT BAADER BANK, ROBERT HALVER, SAYING: "The showdown is approaching very soon. We will have facts considering this Greek referendum and we also have facts considering our ultimatum of Mrs. Merkel and Mr. Sarkozy, saying that if Greeks should vote no, not a single penny will go to Greece and Greece will have to leave the euro zone. That's good news for the markets." The euro also recovered earlier losses, but was still considered vulnerable. Then after midday a surprise interest rate cut from the European Central Bank boosted stocks. Meeting for the first time under Mario Draghi it reduced rates a quarter of a percent to 1.25. Hayley Platt, Reuters.

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Markets yo-yo over Greece and ECB surprise

Thursday, November 03, 2011 - 01:42