FOX Business: The Power to Prosper
Optimism that Greece will be able to take the necessary measures to avert a default lifted Wall Street's sentiment and sent the major market averages soaring more than 1%.
The Dow Jones Industrial Average jumped 145 points, or 1.2%, to 12,189, the S&P 500 rallied 16.6 points, or 1.3%, to 1,297 and the Nasdaq Composite climbed 41 points, or 1.5%, to 2,729. The FOX 50 was up 9.8 points to 908.
The rally sent the blue chips for their best daily performance since April.
Energy stocks like Schlumberger (NYSE:SLB) were the top performers on the day by far, tracking steep gains in the commodities complex. Technology shares such as Electronics Arts (NASDAQ:ERTS) had a strong showing as well.
While no specific deal was struck Tuesday regarding the volatile Greek debt situation, there were hopes among market participants that a resolution will be forthcoming. Headlines regarding Greece have driven Wall Street higher and lower in recent sessions.
There were sometimes violent protests throughout the day and going into evening in Athens, Greece amid popular uneasiness over austerity measures the embattled nation may take in exchange for a $17 billion emergency bailout from the European Union and International Monetary Fund.
The Greek Parliament is expected to vote Wednesday on a package that includes some $40 billion in spending cuts and tax increases. The vote is expected to be tight: the ruling PASOK party controls the majority in Parliament, and is by-and-large expected to vote "yes," but there have been rumors in recent days that certain members have defected. Prime Minister George Papandreou has tried to rally the party, but has still faced steep opposition, winning a key confidence vote by a narrow margin.
"The odds remain high ... that the bill will pass but uncertainty persists ahead of the vote," wrote analysts at BNP Paribas in a research note.
Without the fresh aid package, many analysts suggest, Greece won't be able to pay the tranche of debt that comes due next month -- forcing it to default. A default by Greece could affect more stable euro zone members like Spain and Italy, and create a cascading effect that pressures global credit markets.
Energy markets rallied on hopes of a resolution to the Greek debt crisis. The euro jumped 0.49% against the U.S. dollar and the greenback fell 0.29% against a basket of world currencies.
Light, sweet crude surged $2.28, or 2.5%, to $92.89 -- the biggest leap in more than a month. Wholesale RBOB gasoline soared 8 cents, or 2.9%, to $2.89 a gallon.
Consumer gasoline prices continue on their downward trend. A gallon of regular gas at the pump costs $3.55 on average nationwide, down from $3.79 last month, but still well above the $2.76 drivers paid last year, according to the AAA Fuel Gauge Report.
On the economic front, consumer confidence fell to its lowest level since November 2010 in June, according to the Conference Board. The index fell to 58.5 from a revised 61.7, far below forecasts of 60.
A pessimistic job outlook weighed on confidence, as more participants said jobs were difficult to get, and fewer said jobs were plentiful. Inflation expectations, which are closely watched by economists, fell considerably during the month.
The S&P/Case Shiller Home Price Index showed home prices in 20 major metropolitan areas rose 0.7% in April on a non-seasonally-adjusted basis, topping estimates of a gain of 0.3%. With seasonal adjustments, the gauge ticked lower by 0.1%, a shallower loss than the 0.2% Wall Street expected. Prices were down 4% from a year ago, slightly higher than the 3.9% decrease analysts forecast.
Home prices took a hit during the economic downturn because of high supply and demand that was weakened by a slew of factors, including a tight mortgage market.
In metals, gold rose $3.80, or 0.25%, to $1,500 a troy ounce. Silver climbed 6 cents, or 0.16%, to $33.65 a troy ounce.
Goldman Sachs (NYSE:GS) tumbled to a two-year low in mid-day trading.
Google (NASDAQ:GOOG) unveiled its new social networking service that takes aim at the red-hot social market pioneered by firms like Facebook and Twitter.
Lockheed Martin (NYSE:LMT) was awarded a $184 million contract to build threat detection systems for the U.S. Army.
Accenture (NYSE:ACN) shares got a boost after Standard & Poor's said the consulting company would replace Marshall & Ilsley (NYSE:MI) on the S&P 500 index next month.
Microsoft (NASDAQ:MSFT) is set to unveil its Office in the cloud software called Office 365, which is meant to compete with other Internet-based productivity programs made by rivals like Google (NASDAQ:GOOG) and Zoho.
Sony (NYSE:SNE) says it became the subject of a major hacking attempt because it attempted to protect its intellectual property on video game consoles.
The English FTSE 100 climbed 0.88% to 5,773, the French CAC 40 soared 1.5% to 3,855 and the German DAX jumped 0.94% to 7,174.
In Asia, the Japanese Nikkei 225 jumped 0.74% to 9,649 and the Chinese Hang Seng inched higher by 0.09% to 22,062.