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Equilibrium's Finance and Investment News Roundup

Our roundup this week is dominated by events in Greece, with the country's international bailout coming to an end on Tuesday. We look at the latest goings-on and the impact this has had on the FTSE. Sticking with the Europe theme, we also consider what it would mean for the financial industry if the UK was to leave the EU.

 

Crucial week for Greece's future

This has been a crucial week for Greece. Last night the beleaguered country missed its debt repayment of £1.13 billion to the International Monetary Fund (IMF). By failing to make the loan instalment Greece became the first developed nation to ever default on an IMF loan. The outcome is uncertain but could result in the European Central Bank no longer supporting the nation's financial system. 

It is also still up in the air whether or not Greece will remain in the euro, and the country's Prime Minister Alexis Tsipras has called for a referendum on Sunday July 5th. Mr Tsipras is positioning the referendum as a vote on austerity, while others see it as a vote on whether Greece remains in the currency union. 

 

Greek PM 'could resign' on Greek vote

Mr Tsipras has hinted he may leave his post should Sunday's snap referendum result in the Greek people voting 'yes' to austerity plans. Speaking on state TV, the Prime Minister claimed that by voting 'no' to austerity, the country would be in a better position to negotiate its future. 

He stated: "We ask you to reject it with all the might of your soul, with the greatest margin possible," adding: "If the Greek people want to proceed with austerity plans in perpetuity, which will leave us unable to lift our head... we will respect it, but we will not be the ones to carry it out." 

 

FTSE 'held back' by Greece concerns

The situation in Greece is continuing to have a marked impact on world markets, including the FTSE 100. Worries about the ongoing crisis resulted in the index falling nearly 3.5% since last week. 

This is close to the lows seen in January this year, and came amid increasing unease as to whether Greece would default on its loan to the IMF on Tuesday evening and run the risk of leaving the Eurozone. 

 

British exit from EU 'would hurt financial industry'

The financial industry in Britain would suffer should the country exit the European Union (EU). This is according to TheCityUK, which warned that such a move could result in companies opting to leave the country. 

The lobby group, which represents the financial industry in Britain, also recommended the proposed referendum on Britain's participation in the EU be held in 2016, enabling companies to make investment decisions sooner rather than later. 

Speaking to Reuters, TheCityUK Chairman Gerry Grimstone said: "If we left the single market, I think it would be disastrous for the City."