HEXUS.sharewatch: Shares plunge but are recovering already

Greece is the word

In the globalised economy, the knock-on effects of potential sovereign debt default are far-reaching.

Last week saw some of the biggest falls on global stock markets since the recovery began, with the main cause being fears that Greece would be unable to service its crippling national debt. This morning, however, the European Commission and the IMF announced a €750 billion emergency fund and debt guarantee package, which is available to all EU countries.

This not only provides assistance for Greece, but for any other EU country should they reach a similar stage. It was the fear of other countries, such as Spain, Portugal and Ireland, potentially defaulting on their debts as well as Greece itself that has caused anxiety among the world's investors, so the European bail-out fund has done much to reassure them.

As a consequence, last week's large falls in global stock markets look set to be largely reversed today, with the FTSE already up around five percent and the French stock market up over eight percent.

All our tech stocks suffered last week, with ARM, Avnet, HP, Nokia and NVIDIA all experiencing double figure percentage falls. ARM and Nokia may have paid for being European companies, but many of the other biggest fallers, like Apple, may have experienced corrections after a prolonged rise in their share prices.