US equity markets opened higher and spread optimism across European stocks which reversed earlier losses and climbed higher during the afternoon’s session. In the US, the Dow Jones index has added over 150 points (+0.85%) while the S&P 500 and NASDAQ indices added between 0.75% and 1%, at the time of writing.
The CAC, DAX, IBEX and London equity benchmark indices rebounded from earlier losses and climbed higher between 0.15% and 0.5%. The biggest surprise was the Athens Stock Exchange index which rebounded and closed 0.37% higher after hitting a 3-year low earlier during the session, following four consecutive sessions of sharp losses.
All eyes are on the key meeting of Eurozone’s finance ministers in Brussels today. The euro rallied over 1.14 against the USD amid hopes that there might be a last minute plan for Greece.
In the meantime, the USD index continues to remain under pressure for a second straight session heading towards 93.50 against a basket of currencies. The US Federal Reserve kept interest rates unchanged yesterday, while Fed’s Chair Janet Yellen reported the US economy could be strong enough in order to withstand an interest rate hike later this year. Today, we received robust US employment data as weekly jobless claims dropped to 267K from 279K beating analysts’ expectations of 277K. Furthermore, the Philadelphia Fed business index surged to 15.2 in June compared to 6.7 in May, beating estimates of 8.0. The Leading index also rallied 0.7% in May versus estimates of a 0.4% rise.
The softer USD provided strong support to most commodity prices. Gold surged above $1200/ounce acting as a safe-haven and silver rebounded above $16.