Photo: Flickr – shaggy359
Europe still hasn’t been fixed.First the scoreboard:
Dow: 12,855, +19.9, +0.1%
S&P 500: 1,357, +3.4, +0.2%
NASDAQ: 2,933, -1.0, -0.0%
And now the top stories:
- Greece’s PASOK (socialist) leader Evangelos Venizelos continues to scramble to form a government following last Sunday’s wild elections. One question is whether Greece will hold new elections in June. Polls show that the left-leaning Syriza party would win big. That would increase the representation of people who want no cuts and more government spending. Meanwhile, the Greek unemployment rate climbed to 21.7 per cent in February. See Also – Sovereign Debt: A Modern Greek Tragedy >
- BNP analyst Paul Mortimer-Lee published some research this morning on the consequence of a Greek exit from the eurozone. In summary, GDP would fall 20 per cent, inflation could spike 50 per cent, and debt/GDP could spike to 200 per cent. See Also – ART CASHIN: These Are The Warning Signs Of Contagion >
- Having said all that, global markets rallied following a six-day losing streak for the Dow. But a couple of top stock market watchers warn that we shouldn’t get too optimistic just yet. Morgan Stanley’s Adam Parker can thing of 13 reasons why the rest of Wall Street is over-estimating S&P 500 earnings estimates. Marc Faber, author of the Gloom Boom & Doom report laid out the conditions under which we might experience a 1987-style crash later this year.
- But if you must buy stocks, Europacific Capital’s Peter Schiff recommends moving money into gold stocks, which he argues could return 100 per cent in a year. Also on gold, Goldman Sachs’ Jeffrey Currie called the precious metal the “currency of last resort” and wrote that it could head to $1,840. Gold continued to trade under $1,600 today.
- Weekly jobless claims climbed to 367k from 365k last week. This was a hair below the 368k economists were looking for. Nothing to see here.
- The big loser in today’s trading session was Cisco Systems. First quarter earnings came in line with expectations, but guidance was weak. CEO John Chambers expressed particular concerns regarding Europe and the US Government.
- Don’t Miss – GOLDMAN: These Companies Will Get Crushed In The Fiscal-Cliff-Mageddon >