GREECE GIVES IN, STOCKS RALLY
In an about-face development, the Greek government acceded to the demands of its creditors Thursday night. Prime minister Alexis Tsipras submitted a bailout proposal similar to the one the Greek people had rejected by referendum on July 5, including sales tax hikes, pension spending cuts and debt restructuring. Leaders of the European Union will discuss the new proposal at a Sunday summit. A 3-year, €53.5 billion relief package depends on their approval, and the approval of Greece’s parliament. Wall Street certainly approved the turn of events on Friday, with the S&P 500 rising 1.23%. For the week, the S&P went -0.01% to settle at 2,076.62, the Dow +0.17% t0 reach 17,760.41, and the NASDAQ -0.23% to descend to 4,997.70.
A GAIN FOR THE ISM SERVICES PMI
The Institute for Supply Management’s services sector purchasing manager index rose 0.3 points in May to a mark of 56.0. For the past year, it has averaged a reading of 57.2. By ISM’s barometer, the sector has expanded for 65 straight months.
YELLEN: 2015 RATE HIKE SEEMS “APPROPRIATE”
Speaking in Cleveland Friday, Federal Reserve chair Janet Yellen said that “it will be appropriate at some point later this year to take the first step to raise the federal funds rate and thus begin normalizing monetary policy.” She noted that the steps to normalization would be data-dependent and gradual, adding that “monetary policy will need to be highly supportive of economic activity for quite some time.”
CRUDE & GOLD PRICES SINK
West Texas Intermediate crude closed down at $52.74 on the NYMEX Friday after rising more than $1.oo for the session. Gold and silver both lost 0.5% for the week, respectively settling at $1,157.90 and $15.48 on the COMEX Friday.
THIS WEEK: U.S. markets will react to the outcome of the EU summit Monday; no major news is scheduled stateside. Tuesday, June retail sales figures complement earnings from Fastenal, Johnson & Johnson, JPMorgan Chase, Wells Fargo and Yum! Brands. Wednesday, Fed chair Janet Yellen testifies on monetary policy in Congress; Wall Street also considers a new Fed Beige Book, the June PPI, June industrial output and earnings from Bank of America, BlackRock, Intel, Delta Air Lines, East West Bancorp, Kinder Morgan, Seagate, U.S. Bancorp and Netflix. Thursday brings new initial claims numbers and earnings from BB&T, Blackstone Group, Charles Schwab, Domino’s, eBay, Goldman Sachs, Google, Mattel, Philip Morris, Schlumberger, Citigroup, Sherwin-Williams and UnitedHealth. Friday, earnings from Comerica, GE and Honeywell appear plus the June CPI.