Drama in S&P 500 Charts as 200-Day Average Looms With VIX at 19

30 Jun 2015 | Author: | No comments yet »

Greece Worries Wane, U.S. Stock-Index Futures Rise.

A day after the Dow plunged 350 points in the worst selloff of the year, U.S. stock-index futures signaled calm was on the horizon for Wall Street at the opening bell.

Futures for the Dow Jones Industrial Average YMU5, +0.51% rose 84 points, or 0.5%, to 17,604, while those for the S&P 500 index ESU5, +0.66% were higher by 12 points, or 0.6%, at 2,063. The Ontario Teachers’ Pension Plan says it has an agreement with Cenovus Energy Inc. to acquire Cenovus’s wholly-owned subsidiary, Heritage Royalty Limited Partnership, in a deal worth about $3.3 billion. The deadline comes after weeks of failed negotiations between the nation and its international creditors – and a refusal from Prime Minister Alexis Tsipras to accept a new bailout deal that would have Greece cut pensions and raise taxes. Tuesday morning, investors also are set to wrap up the second quarter and the month, with a reading on consumer confidence and an update from the housing sector ahead. An early Tuesday morning report from Athens’ daily newspaper Ekathimerini suggested the Greek government could consider a last-ditch acceptance of a previous proposal from European Commission President Jean-Claude Juncker , one that Tsipras called “absurd.” But Greece’s Finance Minister Yanis Varoufakis told a group of reporters that, “no,” the nation will not meet its IMF payment deadline.

Though a default for Greece on its obligations could seem like dire circumstances, for the most part, market participants in the U.S. said that outcome is essentially priced-in to the market. “In the big scheme of things, in relation to the global economy and investment landscape, [Greece doesn’t matter]…Most people agree on this point including us,” Dan Greenhaus, chief strategist at BTIG wrote in a note to clients Monday night. “Many have told us like Cyprus, QE’s end or the debt ceiling, this will be a terrific buying opportunity.” Added to that, David Madden, market commentator at IG, said while the uptick in the futures market initially appreared a short-covering after Monday’s big drop and amid the wide-scale selloff in Europe, sentiment has shifted, and a positive day on Wall Street seems to be setting up. “After Tsipras has stated he would consider accepting the terms put forward by Juncker, and the U.S. index futures have continued to rally on the back of that, the Greek debt saga has a history of ending with a compromise being reached, and dealers are quietly confident Greece will make good on its payment,” Madden said. General Electric rose 0.26 per cent in premarket trading after it said it would sell its European private equity financing unit to Japan’s Sumitomo Mitsui Banking for more than $2 billion.

Greece on Tuesday is slated to miss its 1.54 billion euro ($1.71 billion) payment to the International Monetary Fund, and the country’s bailout program also expires the same day. He continued that equity markets could stand to rally if the Greek PM supports the European Commission’s so-called bailout terms before Tuesday’s deadline.

June Consumer Confidence. [Expected 97.5 vs. 95.4 in May.] Volatility has returned to the stock market, and it could become more prevalent over the next few days if worries increase over possible contagion from Greece’s debt drama. CAG, -1.30% shares rose 1.3% after the company reported fiscal fourth-quarter earnings and said it’s planning to exit the private-label business as it focuses more on growing its consumer and commercial foods segments. The operator of the University of Phoenix said its quarterly profit dropped to $48.1 million, or 44 cents a share, from $66 million, or 59 cents a share, a year earlier. Europe, Athens Battle for Greek Hearts and Minds: European and Greek leaders began their battle for the Greek electorate, each trying to convince voters—who suddenly hold the future of Europe’s currency union in their hands—as to which path will bring the least pain. European Stocks Fall Further: European stocks extended losses on the day Greece’s international bailout program is set to expire, leaving the country teetering on the brink of default.

What to Look Out For in Greece’s Referendum: Greek politicians have turned their back on any deal with their country’s creditors, and instead put Greece’s future in the eurozone in the hands of its voters. Willis Group, Towers Watson to Merge: Insurance broker and risk advisory firm Willis Group and professional services group Towers Watson have agreed to an all-stock merger that values the combined company at $18 billion. Puerto Rico Urges Concessions From Creditors: Investors in Puerto Rico’s bonds braced for losses as soon as this week, after the U.S. commonwealth said it can’t pay its debts. Webcast by Puerto Rico’s Governor Momentarily Shows Game Show Instead: A webcast meant to deliver a message from Puerto Rico Governor Alejandro Garcia Padilla on the island’s financial woes instead started on a lighter note, as the feed mistakenly began by showing the game show “¿Quién Sabe Más?” KKR Agrees to $30 Million SEC Settlement: KKR agreed to pay nearly $30 million to settle charges that it improperly shifted more than $17 million in so-called broken-deal expenses to its funds, breaching its fiduciary duty.

Wall Street Is Watching for the Imminent Leap Second: Firms and exchanges around the world will be watching markets closely on Tuesday, June 30th at 8 p.m.

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