Greek PM attempts back flip as polls suggest tight referendum result, European stocks rally, Wall St higher, ASX futures down 3 points

All is looking pretty well with the world this morning, when compared to where we were at the beginning of the week. I'm not a heavy consumer of Greek news (chiefly because of my inability to read it), so I'm going to take the polling that appeared on 'Euro2day' at face value and encourage any Greeks among the readership to let me know if it's a particularly partisan website or not. The image below tells the polling story according to this news site, showing that, coming into Sunday's referendum, there is a slight lead in the 'Yes' camp. Irrespective of its accuracy, there is little doubt that it assisted Greek PM Tsipras in softening his resolve with regard to last Sunday's shock referendum announcement.

Source: Euro2Day, Rivkin
Last night, the Greek PM basically 'blinked first' in the current stand-off by attempting to accept the previously-rejected terms in order to get agreement on funding for the next two years. It could be argued that his tick-tacking on his approach to these negotiations has weakened the Greek negotiating position, and last night he went on television and told Greeks that a 'No' vote would strengthen his bargaining position, which would have done two things: first, it would have infuriated the creditors; second, it would have clearly signalled to the creditors that they have the upper hand – the Greeks clearly want to get a deal done and their PM likely lacks the will to follow through with a eurozone exit bluff.
On the local stock exchange, the ASX's performance is being netted off a little by commodities weakness (weakening resources stocks) and buying strength in financial stocks. The theme that we began predicting last week with regard to the divergence in performance between the ASX 200 and the ASX 200 Financials is beginning to play out and–irrespective of lacklustre performance in futures trade last night–it does look technically as though the ASX 200 financials, and possible the ASX 200 as a whole, are being given an opportunity to retrace the recent sell-off and lift higher.
Source: Rivkin, Saxo Bank
 

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This article was written by Scott Schuberg, CEO of Rivkin Securities Pty Ltd. Enquiries can be made via info@rivkin.com.au or by phoning +612 8302 3600.