Market Look Ahead to Result of Greek Vote

        By Jon Sindreu
        LONDON--All eyes will be on Greece next week after the outcome of its referendum on European lenders' demands is known Sunday evening, with investors fearing a "no" vote could rattle European markets.
        Analysts expect European stocks and bonds to rally or fall sharply depending on the result of the referendum.
        Recent polls suggest the outcome is too close to call on whether Greeks will accept demands from the country's creditors or risk an exit from the single-currency area. Prime Minister Alexis Tsipras says a "no" vote wouldn't lead to Greece being expelled from the eurozone, but rather to a better deal.
        Greece's future in the eurozone seems to hang in the balance: This week it became the first developed nation to default on a payment to the International Monetary Fund. Nevertheless, most analysts agree a bailout agreement is possible even if voters reject the new rules.
        "The population shows strong support for the euro," economists at Bank of America Merrill Lynch underscored in a research note Friday. "Even after a 'no' we could see [Mr. Tsipras] resigning which, potentially, could lead to elections which, in turn, could lead to the formation of a new government that could negotiate from a more constructive position."
        Also due this coming week, a barrage of industrial output data is expected by economists to show the sector recovered in May in both Italy and France, after slumping in April. However, German industrial production likely remained flat, as recent surveys showed businesses turning less optimistic.
        (Figures in parentheses refer to number of economists surveyed)
        Write to Jon Sindreu at jon.sindreu@wsj.com
        (END) Dow Jones Newswires

        July 03, 2015 12:37 ET (16:37 GMT)

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