Overlooking a rare Greek gift?

By declaring an early presidential election, Greek Prime Minister Antonis Samaras has taken the initiative. He has backed his position up by proposing a moderate presidential candidate, increasing the prospect of luring opposition MPs to his cause. The negative reaction of Greek markets reflects surprise at the move and worsening external markets have compounded this selling pressure. But the fundamental picture is not quite so bad and there is the further kicker for Greek bonds in the form of expected ECB sovereign bond purchases. While this trade is speculative, we think Greek sovereigns have scope to rebound.

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