Greek Uncertainty Continues, Spain on the Brink

The leader of Greeces second party stepped up his anti-austerity rhetoric, say Greece should put a moratorium on all debt payments. The euro fell below 1.30 but rebounded on signs of compromise from conservative leader Samaras. No upper-tier economic releases are scheduled for the Asia-Pacific session. Tuesday's Premium Insights are found here: http://ashraflaidi.com/products/sub01/access/?a=633

The leader of the breakthough party in the Greek elections Alexis Tsipras continues to sound more like a zealot than a deal broker. He sent the euro below 1.30 on Tuesday after he said the election results make the Troika bailout accord null and void.

The euro rebounded after conservative leader Samaras said he is willing to tolerate a minority government and does not want new elections. The euro rebounded to nearly 1.3050 in the aftermath of his comments.

The European Union has responded to the Greek electoral uncertainty by scheduling a summit on May 16, the same day a new Greek election could be called.

Overlooked in the focus on Greece was a troubling statement from Spanish PM Rajoy. He said the Spanish Treasury is practically the only entity in the country that can finance itself on the market with funding channels closed for the rest of the economy. At this point, a Lehman moment in Spain appears closer than ever.

Risk trades fell hard at the end of European trading with the S&P 500 falling as much as 1.65% and commodity currencies struggling but those trades later rebounded with stocks closing down just 0.4%.

-AB