Greek Rescue Hopes Ignite Rally

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The Dow jumped more than 100 points, while the Nasdaq soared 2%, amid optimism Greece will take the measures necessary to avoid having to default on its debt.

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Today's Markets

The Dow Jones Industrial Average was up 110 points, or 0.91%, to 12,190, the S&P 500 gained 17.2 points, or 1.3%, to 1,296 and the Nasdaq Composite climbed 57.6 points, or 2.2%, to 2,687. The FOX 50 was up 10.9 points to 907.

Euro zone finance ministers agreed late Monday to give Greece two weeks to push through deeper austerity measures, including tax increases and spending cuts, in exchange for a roughly $17 billion emergency loan.

The aid would help Greece, which has a nearly half a trillion dollar debt load, pay off the next round of debt without restructuring or defaulting on its bonds -- a move that could send reverberations through global credit markets.

Greek Prime Minister George Papandreou has reshuffled his cabinet, including hiring a new finance minister, in a bid to restore faith in his beleaguered government.  Austerity measures have been highly-unpopular among Greek citizens, spurring massive protests.  The Greek parliament is expected to make a confidence vote at 5:00 PM ET, which many analysts see as a crucial milestone in getting austerity measures passed.

The Nasdaq posted its biggest gains since October, while the broad S&P 500 had its best day in close to two months.

Baidu (NASDAQ:BIDU) was one of the top-performing Nasdaq issues after revealing it expanded a deal with China Real Estate Information (NASDAQ:CRIC) regarding real estate advertising on search engines.

Out of Dow components, Caterpillar (NYSE:CAT) posted big gains for the second day in a row after the world's largest heavy-machinery reported Monday a more than 50% increase in dealer sales over the past three months ended in May.  Shares of aluminum giant Alcoa (NYSE:AA) also soared.

Existing home sales fell by a slightly narrower margin than expected in May.  Sales of existing homes were down 3.8% to an annualized unit rate of 4.81 million from a revised 5 million the prior month, a six-month low, according to the National Association of Realtors.

Wall Street expected existing home sales to have fallen 5.9% for the month. Meanwhile, the median home price fell 4.6% from May of last year to $166,500. The ratio of distressed sales to normal sales fell from 37% to 31%, which economists pointed to as a positive factor.

A high-supply of housing coupled with weakness in the mortgage market hit the real estate market during the economic downturn. Indeed, economists at Barclays Capital noted the supply of homes "remains about twice as high as pre-crisis levels and is an indication that high numbers of foreclosed properties continue to keep inventory levels elevated relative to the pace of sales."

On the earnings front, Walgreen's (NYSE:WAG) profit jumped 30% to $603 million, or 65 cents a share, on $18.37 billion in sales in its fiscal third quarter.  Analysts were expecting the drug store chain to earn 63 cents on revenue of  $18.36 billion for the quarter. Sales of stores open at least a year were up 4.1% on the quarter.

The company, however, said it was unsuccessful in renewing its contract with Express Scripts (NADSAQ:ESRX), meaning it is not planning on being part of the Express Scripts pharmacy network effective in 2012.  Shares were down sharply on the news.

JPMorgan Chase (NYSE:JPM) agreed to pay $154 million to settle charges levied by the Securities and Exchange Commission alleging the financial giant misled investors in certain mortgage-backed securities transactions.

Energy markets were mixed despite weakness in the U.S. dollar. The greenback fell 0.52% against a basket of world currencies and the euro gained 0.73% against the dollar.

Light, sweet crude was up 5 cents, or 0.29%, to $93.40 a barrel.  Wholesale RBOB gasoline down 3 cents, or 0.99%, to $2.89 a gallon.

Consumer gasoline prices continue moderating.  A gallon of regular gas costs $3.64 on average nationwide, down from $3.85 last month, but well above the $2.74 drivers paid last year, according to the AAA Fuel Gauge Report.

In metals, gold was up $4.40, or 0.29%, to $1,546 a troy ounce.  Silver was up 31 cents, or 0.85%, to $36.38 a troy ounce.

Corporate News

Best Buy (NYSE:BBY) boosted its quarterly dividend by 7% to 16 cents a share and authorized a $5 billion share repurchase program.

Barnes & Noble (NYSE:BKS) posted a loss of $59.4 million, or $1.04 a share, for its fiscal fourth quarter, substantially wider than the 91 cent loss analysts predicted.

Foreign Markets

The English FTSE 100 jumped 1.4% to 5,774, the French CAC 40 was up 2% to 3,865 and the German DAX climbed 1.8% to 7,279.

In Asia, the Japanese Nikkei 225 was up 1.1% to 9,460 and the Chinese Hang Seng jumped 1.2% to 21,851.

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