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Why Greece is not the only word
18 June 2012 | 14:41 | Source: Ricardo Goncalves, SBS
But is this really the turning point investors had been waiting for?
When it comes to Greece, the first hurdle, is for New Democracy leader, Anotnis Samaras to form a coalition with PASOK boss, Evangelos Venizelos.
With most of the votes counted, New Democracy has around 130 out of around 300 parliamentary seats.
To form an outright government, it needs 151.
With PASOK's 33 seats, a coalition would easily be formed, bumping it above that 151 level, allowing the two groups to push ahead with the austerity measures needed to secure further financial aid, and retain the euro.
German Chancellor, Angela Merkel has already congratulated Mr Samaras and reminded him of his, and Greece's financial obligations.
A coalition is expected to be formed, and announced overnight Australian time.
But, the election win is just one step.
PASOK's Venizelos has already made a couple of public blunders, representative of the dismay of the Greek people.
Mr Venizelos initially said he wouldn't form a coalition with New Democracy without the anti-austerity group Syriza. Hours later he back-flipped, saying Syriza's involvement wasn't a prerequisite.
And even if a coalition is formed, there’s still the threat of a dissolution if there is too much disagreement down the track.
Other ominous black clouds also lie on the European horizon.
The biggest concern is Spain.
A few weeks ago, European investors agreed to bail out Spanish banks to the tune of $125billion.
Days after that, borrowing costs in the country rose to around 7 per cent, the level at which prompted many neighbouring counties to seek a full blown bail out.
Similarly, Italy's borrowing costs are also on the up.
The G20 meeting in Mexico is being closely monitored to see what the world's biggest leaders have to say about Europe.
Even more important will be the EU finance ministers meeting on June the 28th and 29th. It's being billed as the most important meeting since the body was created two decades ago.
Further details of how the zone plans to deal with the ongoing debt problems plaguing the region should be unveiled by the end of that two day meeting.
We already know, global central banks are prepared to stimulate local economies, backed by comments from both the European Central Bank and Bank of Japan, that they're ready to inject liquidity if needed. Even in Australia, the Reserve Bank has been loosening monetary policy by cutting the official cash rate.
Late last week the UK Government pumped $155billion into its economy.
But the biggest market mover may be yet to come.
The Federal Open Markets Committee meets later this week in the United States and there are hopes Federal Reserve Chairman, Ben Bernanke, will announce a new set of quantitative easing measures to improve the US growth rate to kick along employment in the country. That has the biggest potential to influence global markets because at the end of the day, the US is the world’s biggest economy. It’s strength has great influence and flows through to global capital and currency markets and through to the Asian powerhouse economies.
The fear though, is that the market may be already pricing this sort of action in with buyers coming into the market today, and if it doesn't eventuate, investors may be disappointed.