Courtesy of John Nyaradi.
U.S. Stock market posted gains in the major indexes (AMEX:DIA) and (NYSE:SPY) on the hopes that the European Union can finally resolve the financial crisis in Europe (AMEX:IEV)
All major U.S. indexes posted gains as European leaders struggled towards a solution for the crisis in Greece. The Dow Jones Industrials (AMEX:DIA) rose +1.4% while the S&P 500 (NYSE:SPY) tacked on +1.0%.
However, it is likely too early to declare victory as disagreements remain with bankers over the severity of the “haircut” that European leaders are looking for, now estimated as high as 50-60%.
The leaders of Europe have now had fourteen summits in twenty one months but today the German Parliament made a giant step forward with their approval of an upgraded EFSF (European Financial Stability Facility) and Italy promised asset sales and changes to retirement and regulations to lower their deficit.
This, to me, seems to be the real problem. Italy (AMEX:EWI) is a much bigger challenge, and if Greece is presenting this kind of heartburn, one can only wonder how they will deal with a similar, but substantially larger, problem in Italy.
Bottom line: The world hangs on Europe and failure here leads to financial Armageddon. We live in critical days.
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