“We’re seeing a bit of calm in Europe, the euro has gained strength against the dollar, and unemployment claims helped to assuage fears of a major stalling,” said Quincy Krosby, market strategist at Prudential Financial. “But the events in Europe are going to be episodic and we’re just waiting for the next piece of news.”
European markets turned higher amid hopes that Greek leaders could form a coalition government and shore up its commitment to remain in the euro zone. But should those talks fail, the country will likely revert to a technocratic government until new elections can be held.
On Wednesday, euro zone governments agreed to make a 5.2 billion euro payment ($6.72 billion) in emergency aid to Greece, despite opposition from some member states.
Stocks have been whipsawed in the last week over ongoing political unrest in the euro zone. The Dow has plunged 444 points in the last six sessions, its longest losing streak since last August.
“When market moves based on rumor, it is emblematic of a very nervous market,” said Krosby of the recent volatile trading sessions. “But at the same time, a credible announcement could change the tone of a market for a longer period…that’s why this is very much a trader’s market—it’s both dangerous to be in this market as it is to be out.”Page 2 of 5 | Prev Page | Next Page