Greek Melt Up?
The European Union will have a final bailout for Greece “by the end of June and have ruled out a “total restructuring” of the nation’s debt” according to Jean-Claude Juncker, head of the group of euro-area finance ministers.
Stocks rose around the world. The Stoxx Europe 600 Index climbed 1%, while the MSCI World Index advanced 0.8 %. The Euro strengthened to a three-week high against the dollar, and the cost of insuring bank debt fell the most in six weeks. U.S. index futures rallied 1%, and commodities also gained. The 10-year German bund yield climbed seven basis points, while Greek yields slid 30 basis points.
US equities are poised for a 4th consecutive day of gains, trimming some of the losses in May — the worst month for US stocks since August 2010, prior to the announcement of QE2.
~~~
click for updated Futures
Tweet
Facebook
Reddit
Digg this!
May 31st, 2011 at 6:50 am
[...] Optimism about another Greek bailout is buoying markets. (Smart Money Europe, Big Picture) [...]
May 31st, 2011 at 7:17 am
Asia Recap
Asian markets trade higher to end the month with MSCI Asia posting gains for 4th straight day. Optimism that European nations will pledge more funds for Greece to repair its debt provides a boost. Moody’s places Japan’s Aa2 Government Debt Ratings on Review for Downgrade. Oil & Gold higher in Asia trade, while wheat declined after Russia said it will allow grain shipments to resume July 1, easing global supply concerns.
Europe Recap
European markets are punchy today with nearly 2% gains. Comments from an EU finance minister that Greece will not need a “total restructuring” have investors bidding up stocks. Chemicals, autos & construction are the best performing sectors. Euro is trading at 1.44 level – a three week high. Crude is set to have it’s worse month of trading in more than a year – but still trading above $100. German unemployment fell to 7%, the lowest since they unified, in a sign that their economy is still steaming ahead
May 31st, 2011 at 7:53 am
Ahhh, I think investors are in “believe what I say, not what I do” mode for Greece and Euro. The solution to the Greek problem has been found a half dozen times now. The magical solution that protects bond holders without inflicting unacceptable pain on the Greeks. Color me dubious.
May 31st, 2011 at 8:00 am
Meanwhile, over at the Jefferson Memorial:
http://jonathanturley.org/2011/05/30/and-the-happiest-place-on-earth-is/#comments
May 31st, 2011 at 8:01 am
Oh, there’s going to solve the intractable problem in June! Why didn’t they just say so all along (after all, it’s not like it’s a difficult problem or anything). They could have made the announcement in tandem with last year’s bailout and saved the markets a world of trouble.
May 31st, 2011 at 8:18 am
Is the “Bailout Union” coming to the Kindle, Nook, iPad and a bookstore near me?
May 31st, 2011 at 9:00 am
Ha!
So many here in the “big downturn around the corner” camp. Its a RECOVERY… get it yet?
May 31st, 2011 at 9:09 am
Last week was typical low volume melt up before the holiday. Expected as much.
These continuous bullsh*t Greek bailouts can only be interpreted as ploys to temporarily stop some of the rioting – that’s why details are always pushed out to the future re the “bailout”.
End of day there is no way they can bail out Greece and not bailout Portugal, Italy, Ireland and Spain at some point and we all know that is not going to happen or there will be rioting all over Germany, France etc. Even if they provided a legit and detailed bailout plan for Greece they would be only kicking the can down the road for a few months until they have to play whack a mole with one of the others. When Spain comes knocking the entire thing is going to either collapse or each of those countries is going to get kicked out.
May 31st, 2011 at 9:21 am
I still do not understand how default is not the base assumption.
We started at no restructuring at all, now we’re at no total restructuring, can we please skip ahead to paying in Drachmae?
May 31st, 2011 at 9:34 am
So what does your mathematical analysis of the revenue flow, potential growth rates and assets sales tell you about Greece.
Oh, you haven’t done that analysis? So you’re parroting back commentary from which “trusted” talking head?
Greece, the Euro, and the USA will be here long after you’re gone. Find another hobby ARM-chair macro economists. I hope you don’t lose too much investing with your gut instincts, but be assured, you will underperform.
May 31st, 2011 at 9:50 am
This silly “there’s no way they can bailout Greece” is just non-sense.
I generally expect a bailout, zero restructuring… despite the chatter. Bonds and markets are already priced for an awful default, so any resolution will be a market positive.
The basic “benefit” to Germany and France from Eurozone integration and EUR stability might be pegged at about $1T annually. This compares to roughly $400B in total Greek debt. I believe they say that Greece is roughly the size of Ohio in terms of economic relation.
To characterize that as a “BIG” issue… is simply ignorant.
May 31st, 2011 at 10:40 am
cognos Says:
May 31st, 2011 at 9:00 am
Ha!
So many here in the “big downturn around the corner” camp. Its a RECOVERY… get it yet?
reply:
———-
No, not yet. I’m happy to plunder free money from the markets, but only a proven stocktard or someone using OPM would consider today to be one showing economic promise. Perhaps rising oil is proof, to you, of economic expansion since oil would not be rising unless people could afford to pay for it. Thus, $120 oil would be evidence of a pending S&P1600.
May 31st, 2011 at 11:22 am
cognos,
PS, it looks like I’ll make some decent scratch in my bond fund today. If both the ADP and NFP suck and the new claims number is also dismal, I might just double down. Good luck with your stocktard stuff.
May 31st, 2011 at 12:27 pm
Venndata,
You put me in my place. You my master. You a big great man. Me too dumb to read and understand financial info and macro economic mumbo umbo like you. Me too dumb to look at sovereign CDS explosion. Me too dumb to see S&P and Moody downgrades of these countries – months after they were warranted. Me just dumb dumb dumb. You great man. How do you do it? Amazing how they cure problem with these countries just like that. Of course this is the third or fourth time they fix Greece problem just like that. Hmm always seem to fix Greece problem after blood flow in street.
Sounds like they fix Greece just like they fix subprime. You great man though. You superwise. How you do it? How much money do you have to shovel out of the way to reach you keyboard and tell us how dumb we are. You the best. Tell us your A#1 expert numbers that show all good.
May 31st, 2011 at 2:20 pm
“What happens when Greece defaults”
http://blogs.telegraph.co.uk/finance/andrewlilico/100010332/what-happens-when-greece-defaults/