US Stocks Surge as Greece Strikes Bailout Deal with Eurozone Leaders
US stocks advanced on Monday, in a move that is described by analysts and economists as a direct impact of the tentative bailout deal between leaders of the Euro zone and Greece. The Walmart surge saw the Dow Jones industrial average re-emerge on solid ground for the year.
The decision by Eurozone leaders to bailout Greece has significantly enhanced the view of Europe and also placed NASDAQ Composite on an ideal platform for the most impressive three-day run in 2015. Besides, it also put S&P 500 on the right track towards its best three-day run in the past five months.
Tech stocks presented a good rally in the surge with the technology index .SPLRCT leading the market higher. Facebook (FB.O), Netflix (NFLX.O) and Amazon (AMZN.O) all hit record highs. The 1.6% rise registered by Apple (AAPL.O) offered the biggest boost to NASDAQ.
In the bailout deal, Greece won conditional agreement to receive about $95 billion over a period of three years, along with an assurance of talks to narrow a funding gap until the bailout plan is finally ready. The deal has also stipulated a strict deadline for the Greek nation to implement reforms of value added tax, pension and budget cuts.
According to Mike Binger, a portfolio manager at Gradient Investments in Shoreview, Minnesota, ‘’headlines from Greece are going to dissipate a bit and that will impact the emergence of US earnings in the picture as the key factor.’’
The Wall Street surge has also been reinforced by the rise in Chinese stocks for three consecutive days, whereby data indicated that exports increased while imports diminished in June. This implies the global demand might be on the mend.
The Dow Jones Industrial average .DJI moved up by 189.77 points, an equivalent of 1.07% to rest at 17, 950.18. The S&P 500 .SPX garnered 19.38 points, equal to 0.93% to stand at 2, 096 while NASDAQ Composite .IXIC gained 65.28 points, or 1.31% to close at 5,062.98.
Although there were fears about the stumbling oil prices, it has instead boosted US Airline stocks .DJUSAR. American Airlines (AAL.O), United Continental (UAL.N), JetBlue (JBLU.O) and Alaska Air (ALK.N) all rose to the range of between 1 to 3%.
According to the NYSE, advancing issues were more than decliners; 2,129 to 910.