Wall Street opened higher on Tuesday, due in part to strength in the eurozone and an increase in oil prices.
Tuesday, February 3, 2015
Investors still await factors order data that could temper those gains, but easing in central banks across the world could prove enough to keep stocks high.
In Australia, for example, the market reached a 7-year high as the Reserve Bank of Australia reduced interest rates to record lows.
“With yet another central bank cutting rates, the case for additional upside in equities remains intact,” Brenda Kelly, chief market strategist at IG, told MarketWatch. “Add to this the bounce in oil prices and we have some additional enthusiasm for risk assets.”
Stocks built off Monday’s solid gain. A rise in oil prices and a Greek proposal for a debt-swap plan pushed the market higher at Monday’s close. In early trading on Tuesday, the S&P 500 was up 0.9%, the Dow gained 1.1%, and the Nasdaq advanced 0.7%.
Greek resolution boosts eurozone markets
The US was not the only region to enjoy market gains on Tuesday. Eurozone indices gained as well, due in large part to a possible compromise between Greece and its creditors, reported The Wall Street Journal.
Greek Finance Minister is reported to propose a debt swap, which would exchange privately-held bonds for growth-linked and perpetual bonds.
“The Greek public debt will become sustainable, prospects for real growth will open, and the Greek people will finally be able to breathe,” the finance ministry stated. “The government and the finance minister are not backing down, even if our determination saddens some people.”
On Tuesday, the benchmark index in Athens jumped 9%. The Stoxx Europe 600 gained 1.5%, as did France’s CAC 40, the UK’s FTSE 100 and Germany’s DAX 30. There is no guarantee that the debt-swap will completely alleviate Greece’s economic woes, though it does present a possible alternative to a default or – as some analysts feared following the Greek snap election in January – an outright exit from the eurozone.
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