By Greg Peel

The Dow closed down 108 points or 0.9% while the S&P lost 1.0% to 1204 and the Nasdaq fell 0.4%.

A down-session on Wall Street was a given last night following the disappointing EU finance ministers' meeting over the weekend, on the assumption nothing new transpired in the meantime. Daily swings on global stock markets at present have nothing to do with valuations and everything to do with each new episode of In Europe Tonight. A 1.4% drop on the Australian market yesterday and coincident drops in other Asian centres set the scene.

At the epicentre, market falls from the open were swift and unforgiving and there was no new news prior to closing bells to prevent Germany and France finishing down 3% and London 2%. Wall Street opened with the Dow down 250 points as the buyers stood aside. Indices were able to stabilise at that level nevertheless as Wall Street awaited the next piece of news. There was yet another phone hook-up underway between the Greek government and the "troika" of the ECB-EU-IMF in regard to whether or not Greece would be given its next tranche of bail-out funds.

Late in the afternoon session, and very late into the night in Europe, the troika announced it had not yet reached an agreement. This may have been bad news except that the announcement suggested an agreement was very close and that final discussions would continue tonight. In short, Greece needs to implement even more stringent austerity measures in order to qualify for the next hand-out ? more stringent than those which sparked rioting in the streets of Athens some months ago. Aside from raising revenues through tax increases and asset sales, Greece needs to cut government spending. This requires one very difficult policy to be implemented, and that is the sacking of some 100,000 Greek public sector workers.

Rioting in the streets? Methinks we ain't seen nothing yet.

The news of a resolution being close was enough to remove the sellers for the moment and the subsequent short-covering rally ? as much a feature of current Wall Street trade as the opening plunge ? took the Dow right back to be only 65 points down. A bout of late selling came in at the close.

To recap: The Greek government will run out of money at the end of October and not be able to pay its public sector unless it receives the next tranche of the 2011 bail-out fund. This will not constitute default per se ? that will come in December when the next big sovereign debt rollover is due if there is no definitive resolution prior. EU members have yet to agree to and vote on the 2012 bail-out fund required to get Greece through another year as that is currently being held up by the Finnish insistence on cash collateral in exchange for its contribution.