Progress in the Euro debt crisis helped to push stocks higher Monday after Wall Street ended a six-week skid in stock market losses last week. From a technical standpoint, stocks are starting to look promising. The S&P 500 bounced off its 200-day moving average and volatility is declining somewhat. Yet, any momentum the U.S. stock market has seems to be significantly tied to whether or not Greece and the European Union can agree on a bailout package to prevent a default. Experts have compared a default in Greece’s debt could have a bigger negative impact than that of the Lehman Bros. collapse. The U.S. dollar fell against the Euro and oil slid to $93 a barrel. The International Monetary Fund has said that it intends to pay the next tranche of the Green rescue plan if an austerity plan can be reached. The next payment is expected to be made in mid-July.
Major U.S. Stock Indices
DJIA: 12,071.95 (+0.56 percent)
S&P 500: 1,278.04 (+0.51 percent)
NASDAQ: 2,632.83 (+0.62 percent)
Russell 2000: 790.47 (+1.12 percent)
In other news:
- Bank of America (BAC) Merrill Lynch economist: Forget responsible spending and budget tightening, the U.S. should just default on its debt. [Marketwatch]
- The Supreme Court ruled against a class-action lawsuit regarding sexual discrimination Wal-Mart (WMT). Justice Antonin Scalia said the cases were too different to fit in one case. [WSJ]
- Multinational companies are pushing for a tax break that will allow them to realize overseas profits at a reduced tax rate of 5.25 percent versus the standard 35 percent. The benefits are that the economy could receive as much as a $1 trillion stimulus from the private sector through tax revenues and more job creation. The drawbacks are that that isn’t necessarily true. [NY Times]
- If this report is true, Skype did some of their people dirty right before the $8.5 billion Microsoft (MSFT) deal was closed. [Bloomberg]
- The potential of the African airline industry. [Economist]
Check back as more news develops.