European markets hold-up after No vote
Published 07/07/2015 | 02:30
The eurozone's leading index fell 1.7pc yesterday after Greek voters rejected austerity measures demanded in return for a debt deal, raising concerns about the country's possible exit from the euro zone.
The decline was less than feared, but banks were the worst hit, with the Euro STOXX banks index down 2.1pc.
Bank of Ireland dropped 5pc to 34.40 cents a share, Permanent TSB dropped just less than 2pc to €4.60.
Italy's Unicredit and Intesa Sanpaolo each fell more than 3pc. Spain's Santander, France's Societe Generale and Germany's Deutsche Bank all fell about 2.5pc.
The ISEQ index closed down 1.5pc at 6,139.97. In Paris the CAC fell 2.01pc and Frankfurt's DAX 30 lost 1.52pc. The FTSE 100 in London held up better, declining less than 1pc.
Crude oil fell as much as 6pc on fears over Greece and the Chinese economy.
Yesterday's fall was not as strong as some had expected, considering markets had been betting on a rapid resolution of the crisis going into the weekend.
Even so, JPMorgan economists reckoned the outcome of Sunday's referendum would probably hasten Greece's exit from the euro.
Neil Williams, chief economist at Hermes Investment Management, said that was not yet a done deal.
"Markets have yet to be convinced in full either that the exit door will be open or that the extent of any contagion from this could be irreparably damaging to the system," he said.
"From the market's perspective, we have a balanced view that the contagion effect is pretty much contained. There is room for further negotiations with creditors, but we are only talking about hours and days rather than weeks," Bill Street of State Street Global Advisors said.