Hopes for Positive Greek Outcome Spark Rally

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The markets capped the tumultuous trading week on a high note amid cautious optimism that policymakers are prepared for the potential impact of the Greek elections over the weekend.

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Today's Markets

The Dow Jones Industrial Average climbed 115 points, or 0.91%, to 12767, the S&P 500 rose 13.7 points, or 1%, to 1343 and the Nasdaq Composite gained 36.5 points, or 1.3%, to 2873.

For the week, the Dow jumped 1.7%, the S&P 500 tacked on 1.3% and the Nasdaq rose 0.5%. Trading was particularly volatile with traders focused heavily on the debt crisis in Europe.

In particular, traders responded bullishly to news released on Thursday that the Bank of England and UK Treasury will provide 100 billion pounds worth of emergency lending to shore up the country's economy. At roughly the same time that day, Reuters reported that central banks are ready to deploy a coordinated action following the Greek election if it becomes necessary. A spokesperson for the European Central Bank declined to comment on the report.

Market participants remained very cautious with the outcome of the elections in Greece up in the air. Opinion polls showed a tight race between the pro-bailout and anti-bailout parties.

The markets also got several reports on the U.S. economy on the day.

The New York Federal Reserve's regional manufacturing gauge plunged to 2.29 in June from 17.09 in May, a significantly worse reading than the 13 expected. Readings above zero point to expansion while those below indicate contraction. A separate report from the Fed showed U.S. industrial production fell 0.1% in May from the month before, worse than the 0.1% gain that was expected.

A preliminary reading on consumer sentiment for the month of June checked in at 74.1, down from 79.3 in May and lower than the 77.5 economists were expecting, according to a survey by Thomson Reuters and the University of Michigan.

Commodity futures were modestly higher. The benchmark crude oil contract traded in New York rose 12 cents, or 0.14%, to $84.03 a barrel. Wholesale New York Harbor gasoline gained 0.95% to $2.71 a gallon.

In metals, gold edged up by $8.50, or 0.52%, to $1,628 a troy ounce.

Foreign Markets

The Euro Stoxx 50 rallied 1.5% to 2181, the English FTSE 100 gained 0.22% to 5479 and the German DAX jumped 1.5% to 6229.

In Asia, the Japanese Nikkei 225 inched higher by 0.01% to 8569 and the Chinese Hang Seng soared 2.3% to 19234.