Courtesy of John Nyaradi.
Uncertainty in Europe makes U.S. stock market nervous and helps to drive down the Dow Jones Industrials (NYSE:DIA) and S&P 500 (NYSE:SPY)
So it turns out that the rumor of agreement between Germany and France leaked yesterday by the Guardian perhaps was a little premature and the situation remains unstable and uncertain today.
French President Sarkozy flew to Germany, saying that the bailout talks were stalled, and Prime Minister Merkel was quoted on Reuters as saying there is “no magic wand” and that the next summit would not be the end point of the crisis.
Nobody seemed happy today as the Greek Prime Minister works to pass yet another round of austerity measures while his countrymen riot in the streets against these programs with an estimated 70,000 people involved.
The markets aren’t happy, either, as the 1 Year Bond in Greece now yields north of 180% which, as I’ve said before, would be a heck of an investment if they make it.
At home things were slightly less gloomy as some good reports for the housing industry came in, but Apple disappointed and the Fed Beige Book reported overall “modest to slight” growth.
Overall, market participants weren’t happy about today’s news as all eyes turn towards the weekend summit in Brussels.
Bottom line: Europe is making stock markets nervous and, in my opinion, the Euro Zone leaders are going to have a tough time getting in front of this problem. Generally you can’t get a Frenchman and a German to agree on where to go for dinner, much less solve a problem like this, and with recent downgrades of Italy and Spain, the situation grows more ominous because there isn’t enough money in Europe to save those two tottering economies.
Stock Market Round Up:
Dow Jones Industrials (NYSE:DIA) -72.4; -0.6%
S&P 500 (NYSE:SPY) -15.5; -1.3%
NASDAQ (Nasdaq:QQQ) -53.3; -2.0%
Russell 2000 (NYSE:IWM) -14.9; -2.1%
Tomorrow comes the weekly jobs reports, leading indicators and Philadelphia Fed reports.
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