With the woes of Europe dominating the headlines for the start of 2015, the concerns about the future of Greece in the eurozone are upon us yet again. National Bank of Greece S.A. (NYSE: NBG) tends to act as a trading barometer for Greece, and its New York traded shares are signaling more pessimism. Much more pessimism.
NBG was not the only bank to slip Monday. Other European banks fell at the same time after a report in Germany’s Der Spiegel magazine alleging that Germany was prepared to allow Greece to leave the eurozone. Still, a drop of 8% after the open is far from a routine trading day.
According to the report, German Chancellor Angela Merkel and Finance Minister Wolfgang Schaeuble currently consider a potential exit by Greece as “manageable.” despite the previous stance of the German government. The report would go on to say that the government also considers the exit of Greece as “inevitable” if Greece’s opposition leader, Alexis Tsipras, assumes power and if the country fails to service its debts.
Whether Greece will stay in the eurozone will almost certainly hinge on the coming election, which has been a lightning rod of controversy in the midst of Greece’s economic troubles.
ALSO READ: 10 Huge Countries Without Their Own Oil
Der Spiegel is a German publication and one of the largest publications of its kind in Europe. Historically, the publication has played a role in uncovering political scandals and is considered to be one of the most influential magazines in continental Europe.
Shares of NBG were down 8% at $1.69 following this release. The stock has a consensus analyst price target of $3.94 and a 52-week trading range of $1.67 to $5.98. The market cap is roughly $6 billion.
To show yet even more pessimism about Greece, the Global X FTSE Greece 20 ETF (NYSEMKT: GREK) was also hit hard in Monday’s trading session. Shares were down over 6% following the opening bell to $12.88, on the lower end of its 52-week trading range of $12.83 to $25.76. It is worth noting that nearly a third of this exchange traded fund’s holdings are in financial services.
Further adding to the mix, the euro also reached a nine-year low Monday, as it might appear that investors are betting on the European Central Bank (ECB) easing. Mario Draghi, the ECB president, previously said that the risk of the central bank not fulfilling its mandate of preserving price stability was higher now than half a year ago. An exit by Greece would yield some instability, to say the least.
ALSO READ: Can India Outperform Again in 2015?
Want to Retire Early? Start Here (Sponsor)
Want retirement to come a few years earlier than you’d planned? Or are you ready to retire now, but want an extra set of eyes on your finances?
Now you can speak with up to 3 financial experts in your area for FREE. By simply clicking here you can begin to match with financial professionals who can help you build your plan to retire early. And the best part? The first conversation with them is free.
Click here to match with up to 3 financial pros who would be excited to help you make financial decisions.
Have questions about retirement or personal finance? Email us at [email protected]!
By emailing your questions to 24/7 Wall St., you agree to have them published anonymously on a673b.bigscoots-temp.com.
By submitting your story, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
