Courtesy of John Nyaradi.
Monday comes and goes with no agreement on Greece until late night settlement on Greece.
European finance ministers met in Brussels Monday and deep into the night and finally, in the wee hours, apparently have struck an agreement for the next round of bailout money for Greece.
In overnight trading, the European indexes were up with the DAX gaining 1.46%, the STOXX 50 adding 1.2% and the FTSE climbing 0.7%
In Asia, major indexes were down slightly as the world waited for an answer on Greece.
The U.S. Dollar (NYSEARCA:UUP) declined after announcement of the agreement while the Euro Dollar (NYSEARCA:FXE) jumped.
The issue remains the same as it always has been, that is no one wants to take a hit on Greek debt and it’s uncertain that a solution is possible even with the cuts being planned.
Expect volatile action in U.S. markets when investors return from the President’s Day weekend, particularly in iShares MSCI Germany Index (NYSEARCA:EWG) and major U.S. indexes, led by the S&P 500 (NYSEARCA:SPY) will react to the headline news coming from Europe.
The meeting today was supposed to be the final answer but obviously a solution was difficult to find. Now the next question facing the troika of the European Central Bank, International Monetary Fund and European Union is will Portugal follow Greece and will this really be a solution.
Bottom line: Will this new deal be enough and will Portugal be next? How will global markets react? Tuesday will be a busy day.
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