As European leaders gather for their first Summit of the new year, questions are cropping up over the weakening European economy and a possible Greek debt default. Greece now requires 145 billion euro for the second bailout.
A powerful risk-on trade is moving global markets. Emerging markets, especially Indian equities in particular have been beneficiaries of this. However, Mark Matthews of Julius Baer tells CNBC-TV18 that a Greek default can see us swing back into a risk-off trade again.
Brent crude futures dipped below the psychologically-important USD 100 level on Tuesday, as worries that a Greek debt default could spread across the banking system and threaten the global economy showed no signs of abating.
European screens across the board were in the red after news came in that Greece would be unable to meet its deficit targets, sparking fears that a Greek debt default was just around the corner.
With the prospect of a Greek default fueling global markets, Nirmal Jain of IIFL feels that the sentiment in the Indian market is very cautious, adding that investors are in a wait and watch mode.
Bankers are bracing for a second round of losses on Greek debt if an earlier promise to write off 37 billion euros (USD 50 billion) is insufficient to help the struggling country stave off default.
World stocks fell sharply on Monday, snapping a four-day advance, while the euro shed more than 1% as investors feared a possible Greek debt default and the fallout on the entire euro zone.
Callum Henderson,MD, Global Head Of FX Research, Global Research Standard Chartered Bank takes CNBC-TV18's viewers through what to expect from the Euro area and what does the Greek debt default really mean to various asset classes and to the currency pairs.