Greek stock market soared yesterday 10% and several commenters in financial websites mentioned secret election polls showing a sure win on Sunday. Since election polls can’t be made public in the last days before an election in Greece, Greeks are guessing whether Nea Dimokratia or Syriza is the political party that is going to get the most votes and prove the polls correct. On the other hand online bookmakers provide additional information about the crowd’s perception of the election’s result. Although Greek elections in June seemed to go to either side, according to the latest betting odds Nea Dimokratia stands a 75% chance to win! By combining these three factors – alleged secret polls, stock market surging and bookmakers’ data – one can predict the Greek election’s outcome.
Meanwhile the Euro currency has stepped off the gas recently during the 9-month decline from 1.45 to 1.24. EUR/USD is currently trading at the 1.26-1.27 price range during the last day before the election in Greece on Sunday! I suppose Monday will be a very interesting trading day for markets worldwide and most importantly for the Greek stock market. Question is what gaining 10% in a day means in fact. Is it a win for a Europe-friendly party that supports the Greek bailout, or do investors believe in economic growth if Syriza is the election’s winner?
Some comments even refer to foreign investors selling their stocks in artificially-inflated prices due to public’s reaction. The big volume of shares traded on Thursday together with the buying power printed on the stock charts might have led Greeks to trust the stock market once again. But do they really have the money to invest? With more than a million unemployed and with severely cut-down salaries I very much doubt it. Yet, Greeks are well-known gamblers…
