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Monday, January 16, 2012

Last Friday, Credit rating agency Standard & Poor's reduced the credit status of 9 Euro countries. France and Austria both lost their AAA status. The Netherlands keeps its AAA status, but is given a negative outlook. There is a chance of one out of three that the Netherlands will also lose its AAA-status within two years.

The downgrade of the Euro countries puts the credit status of the EFSF-fund under pressure, since its credit status is based on the status of the 17 Euro countries. With only four of the 17 Euro countries with an AAA-status, economists expect that the creditworthiness of the EFSF fund will be reviewed this week.

Today, inspectors of the IMF, ECB and EC will go to Greece to monitor the Greek progress. According to sources close to the trojka, the Greek financial position deteriorated in the past three months. Even if banks take a loss of 50% on Greek bonds, the state debt would be still EUR 20 billion higher than expected.

In addition to the European debt crisis, investors will take also a close look to the fourth quarter results of companies. Heavyweights like Bank of America, General Electric, Intel, Goldman Sachs and Microsoft are among the companies that will publish their results this week. Generally it is expected that most of the results will turn out good, despite the macro-economic problems worldwide.

The 6M Euribor decreased by 2 basis points to 1.51%. The 10Y Swap decreased by 7 basis points to 2.24%

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