Markets Down As Latest Greek Offer Rejected

International creditors have rejected Greece’s latest cash-for-reforms proposal on Wednesday, sending stock markets down after a brief two-day period of optimism. Prime Minister Alexis Tsipras announced the news himself, adding that counter-proposals have been submitted and will be reviewed shortly. However, due to the fact that the original proposal was facing tough opposition within the Greek parliament because of its expansive social cuts, concerns that the counter-proposals would fail to pass as vote have risen. As it currently stands, the International Monetary Fund (IMF) is believed to be the most skeptical of Greece’s efforts and have offered counter-proposals of their own. The international as well as financial communities are keeping a close eye on the situation as Greece must secure additional funding in order to prevent a default on its debts at the end of the month. The news sent stock markets down, highlighting the delicacy of the market. Germany, one of Greece’s largest creditors, has seen its DAX index fall 1% with all but one component declining. The French CAC 40 fell 0.7% and is currently trading at 5002.79 and the UK’s FTSE 100 remained relatively flat with a 0.1% gain. The Athens stock exchange fell 3.3% after the announcement.

U.S. stocks dealt with a similar situation as the Dow Jones Industrials posted their biggest one-day decline in the last month. The Dow Jones industrial average fell 178 points (1%) to trade at 17966.07, the S&P 500 index fell 15.62 points (0.7%) to trade at 2108.58 and the Nasdaq composite index lowered 37.78 points (0.7%) to trade at 5122.41. Wednesday’s declines saw the Dow Jones move into negative territory for the entire month with a 0.2% decline. The S&P has added 0.1% and the Nasdaq added 1% in the last month.

Crude oil prices fell more than 1% on Wednesday after data released by the U.S. Energy Information Administration (EIA) revealed that while crude oil supplies lowered last week, refined products inventories rose sharply. This result maintained market oversupply concerns as all major oil producers remain on high output. The uptick in gasoline inventories is more than enough to offset any declines seen in crude inventories, making the EIA’s most recent report neutral in terms of market reaction.

Today’s economic data releases include the U.S. initial jobless claims, providing an estimate for the number of newly unemployed workers. Japanese inflation data will be revealed toward the end of the session.