A Calm Day on Wall Street, All Eyes on Greece

Wall Street toyed with its opening mark yesterday as Greece deficit problems, a statement from Ben Bernanke and fundamental data all had an effect on the intraday session. Even though volume was around average, investors were reluctant to take any major position, due to the recent correction. The S&P500 finished the session around its trend line resistance and formed a doji like candlestick, showing investors indecisiveness.

Bernanke released his strategy to pull back some of the money in the system. Even though exiting the market might not be as simple as in the past, Bernanke noted that the Fed is ready to move, and it would depend on economic conditions. Bernanke also stated that the rate paid to banks on excess reserves held at the central bank may for a time replace the Fed funds rate as the main operating target for policy. Furthermore the bank could increase the gap between the discount rate it charges banks for emergency loans and the fund rate.

Greece continued to weigh on investor’s confidence, as the Eastern European member is now being scrutinized on a daily basis by top policy makers. Even though no formal bail-out plan has been released, rumors are flooding the markets, mentioning that Germany will do its utmost to help the distressed economy. During yesterday’s session Greece’s credit default swaps took a nose dive as investors found comfort in the recent discussions.

Out of the nine major U.S sectors financials was the only sector to finish in positive territory with a profit of 0.8%. Materials and Healthcare both weighed on the session, closing down by -0.68% and -0.61%, respectively.


Read the full article at Dodjit.com