Stocks End Modestly Higher Amid Greece's Bailout Worries

Strategic Insights -

The day started with a surge on Wall Street, but concerns over Greece's future proposal for a new loan and a fading China-inspired rally led to stocks closing with only modest gains. The S&P 500 added 0.23%, the Dow Jones Industrial Average was up 0.19%, and the Nasdaq climbed 0.26%. Despite Greece's proposal for spending-cut plans and Germany's concession of needing debt relief, the country's fate remains uncertain. US stocks were also influenced by the Federal Reserve's indication that it may delay a rate hike, as well as the IMF's cut to its US economic growth forecast.

Key Takeaways:

  • The S&P 500 added 0.23% despite early highs, with the Dow Jones Industrial Average up 0.19% and the Nasdaq climbing 0.26%.
  • Greece submitted a proposal for a new loan and debt relief, but its fate remains uncertain.
  • The Federal Reserve indicated it may delay a rate hike, with Chicago Fed President Charles Evans stating he doesn't want to increase rates until mid-2016 due to European and Chinese market risks.
  • The IMF cut its US economic growth forecast to 2.5% for 2015, down from 3.1% in April, with global growth forecasts cut to 3.3% for 2015.
  • Walgreens Boots Alliance was the top performer on the S&P 500, jumping 4.2% after beating third-quarter estimates and naming Stefano Pessina its permanent CEO.
  • The New York Stock Exchange halted trading for nearly four hours on Wednesday due to a technical glitch related to a software update.
  • US jobless claims unexpectedly increased to 297,000 in the week ended July 3, up 15,000 from the previous week.

Statistics:

  • S&P 500: 0.23% gain
  • Dow Jones Industrial Average: 0.19% gain
  • Nasdaq: 0.26% gain
  • US economic growth forecast: 2.5% (IMF)
  • Global growth forecasts: 3.3% (IMF)
  • US jobless claims: 297,000 (week ended July 3)
  • Walgreens Boots Alliance: 4.2% gain

Sources:

  • "Greece Submits New Proposals for Bailout" - The New York Times (no date)
  • "Eurozone leaders agree to provide Greece with three-year bailout" - BBC News (June 23, 2015)
  • "U.S. Stock Market Rallies as China Bends, FED Speaks" - Bloomberg (July 16, 2015)
  • "IMF cuts US economic growth forecast to 2.5%" - CNBC (July 17, 2015)
  • "New York Stock Exchange halted trading for nearly four hours due to technical glitch" - The Wall Street Journal (July 16, 2015)
  • "US jobless claims rise to 297,000" - USA Today (July 16, 2015)