Is Greece Getting A Lifeline?
The market is getting a nice boost this morning on improved sentiment over the situation in Greece. There are rumors that the EU might throw Greece a bone, and that is helping the euro rally. Of course, the flip-side is that the EU could be going down a slippery slope if they decide to do this, because Spain, Portugal, Ireland, etc. would be the first to get in line.
The strong euro is coming at the expense of the dollar, which is boosting commodity prices. Oil is higher, trading above $73.10, while gold has bounced back to the $1075 level.
Among the sector ETFs, energy and materials are leading the way, while financials and real estate are lagging, especially real estate (-0.96%). The Dow is sitting right at 10,000, which is really just a psychological hurdle that investors will keep an eye on.
One of the things that is weighing on the financial sector is the news that Standard & Poor's has lowered their outlooks for Citi (C) and BofA (BAC) to negative from stable.
Asian markets were mostly higher overnight; the 10-year yield is flattish near 3.59%; and the VIX is a tad lower to 26.38.
Trading comment: Yesterday's action was a bit disappointing, but volume was rather light. This morning's rally looks promising, but I am always skeptical of a market that is too strong right out of the gate. I would prefer the rally to build into the close. But let's give it the benefit of the doubt. We need to see a nice rally on rising volume to signal a change to the short-term trend in the market.
I have yet to put any cash to work, but may dip my toes in the market if today's closes strong. The market is still oversold, and due for at least a short-term bounce.