As the election results came pouring in yesterday that the Greek elections will likely lead to the country remaining in the EU for the near future the consensus was a rally would take place today in the US markets. A rally overnight was greeted with selling this morning and an up and down session that saw the S&P 500 finish the day with a minimal gain of 2 points. The gain was enough to close at the best level in over a month for the index.
The attention quickly moved from the Greek election to the situation in Spain and Italy. The yields on the Spanish 10-year bonds rose well above 7% to levels that nearly every believes is unsustainable. The iShares Spain ETF ($EWP) fell by 3.5% and the iShares Italy ETF ($EWI) lost 2.8%. Even the Global X Greek ETF ($GREK) lost 2.5% after a major rally last week.
The SPDRs S&P 500 ETF ($EWP) is on the verge of breaking above its 50-day moving average for the first time since early May if it can close above $135/share. The ETF closed today at $134.41.
The rest of the week will be driven by news and rumors out of Europe as well as the Fed announcement midweek. Look for above average volatility.
**I remain a buyer on weakness!!
Market expert and TV personality Matt McCall blogs about what is really moving the markets. He will emphasize Exchange-Traded Funds (ETFs) and individual stocks throughout the trading day.
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