Mixed trading expected in Asia as Greece takes steps to resolve financial crisis

Asian stocks are expecting to open mixed today with slightly negative leads from U.S. markets late last week possibly offset by positive news around the European debt situation.

Greek Prime Minister George Papandreou has reportedly agreed to step down as premier to allow the creation of a national unity government that will secure international financing for the country and avert a default. There will be more twists and turns in this Greek saga but for now it seems like a plan is in place to sure up financing before next month’s crucial deadlines.

The EUR/USD remains above 1.38 on the news, not as strong as some would have hoped for, particularly given the sluggish U.S. jobs numbers out on Friday which did see a fall in the unemployment rate to 9% but lower overall job additions.

Elsewhere in the region, most of the talk around Japan over the past few weeks by global markets has centered on currency controls. There is no doubt this firm move by Japanese authorities to contain currency appreciation comes as pressure from key multinational export giants grows. Today we note something different. Japan last week approved plans to send 200 ground self defense forces to South Sudan in January, with more than 200 to be sent later, as part of a U.N. national building mission.

The move may however do more with geopolitics than peace keeping. It seems like Japan, already under pressure to shore up energy security post Fukushima, is potentially signaling a greater role in oil rich South Sudan.

This could see Japan further expanding its investment in Africa, countering an already proactive China policy in the continent. Not an immediate investment theme, but something worth keeping an eye on for those trading energy markets or individual energy securities.

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