Receive $80 Grab vouchers valid for use on all Grab services except GrabHitch and GrabShuttle when you subscribe to BT All-Digital at only $0.99*/month.
Find out more at btsub.sg/promo
[TOKYO] US stock futures edged up and the euro sagged in early Asian trading on Tuesday as Greece lurched toward defaulting on a debt payment due later in the session, raising the likelihood of the cash-strapped nation's exit from the euro zone.
Greece will not pay a 1.6 billon euro loan instalment due the International Monetary Fund on Tuesday, a Greek government official told Reuters, after talks between Athens and its creditors broke down over the weekend when Prime Minister Alexis Tsipras called a surprise referendum on the austerity plan. "The Greek government's willingness to walk into the fire is a dangerous proposition for Europe and the global markets," Kathy Lien, managing director of FX strategy for BK Asset Management in New York, said in a note to clients.
Ratings agency Standard and Poor's cut Greece's sovereign debt rating one notch further into junk levels to CCC-, saying there was a 50 per cent probability it would leave the euro zone.
US stock futures were up about 0.2 per cent in Asia, suggesting that a semblance of stability could return to markets after steep losses in the previous session.
In overnight trading on Wall Street, all three major stock indices tumbled, with the Dow Jones industrial average shedding 1.95 per cent, the S&P 500 losing 2.09 per cent and the Nasdaq Composite dropping 2.4 per cent.
The euro fell to a one-month low of US$1.0955 on the EBS trading platform on Monday and then reversed direction in North American trade as investors exited their euro-short positions, pushing the common currency as high as US$1.1279. It was last down about 0.2 per cent on the day at US$1.1215.
Until volatility spiked due to developments in the Greek crisis, investors had used the euro to fund carry trades - a strategy of borrowing in a low-yielding currency to buy higher-yielding assets.
The dollar was flat on the day at 122.54 yen after falling to a one-month low of 122.10 yen on Monday, with market participants citing options-related support at 122.
In commodities trading, US crude oil futures extended their fall after skidding more than 2 per cent on Monday to three-week lows. US crude was down 0.2 per cent at US$58.22 a barrel.
Read more on the Greek crisis here.