Greece Gives No Gusto to Global Markets and ETFs
Markets and ETFs continue to slide as Greece flares up global markets again.
Yesterday’s flat and confused ETFs were not so confused anymore today, as Greece has once again decided to roil world markets with its anti-Euro sentiment. The new Greek Prime Minister, Antonis Samaras of the New Democracy Party, has failed to create a coalition government, which allows runner up Alexis Tsipras of the runner up party Syriza to form a coalition Government. Tsipras has vowed to renegotiate the terms for further international aid to Greece, and whichever party does end up in power will have thirty days to pay interest on loans maturing in 2016, or face default (and exit the Euro)? In short, if Tsipras and his anticipated coalition government gain power, Greece might default and perhaps exit the Euro. I must admit, this Greece thing is getting very old.
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So, US market performance: surprisingly not too bad considering no grease from Greece, although negative no doubt. The SPDR S&P 500 ETF (NYSEARCA:SPY) declined .4% while the SPDR Dow Jones Industrial Average ETF (NYSEARCA:DIA) lost .59%. The PowerShares QQQ Trust Series 1 ETF (NASDAQ:QQQ) lost .37% while the iShares Russell 2000 Index ETF (NYSEARCA:IWM) lost .06%. Our oil ETF friend, the United States Oil Fund LP ETF (NYSEARCA:USO) continues to lose ground, as it lost .49%. If Greece continues to withhold grease in terms of resistance to cooperation via austerity measures and further fiscal union with the Euro, things could get very ugly, very fast, again.
Perhaps US markets were saved a touch by the relatively positive Small Business Optimism Report, which indicated that the said index increased by 2 points, suggesting that Small Business owners are feeling more positive about the future. Today’s Job Openings Report, however, was flat as a pancake. Any saving grace today for US markets or our economy? Not so much.
Bottom Line: Tomorrow is another day for Greece, Spain, and the rest of Europe to continue burning up and bringing US markets (and oil) along with them. If Greece continues to be the despised child in Europe, the world will likely pay the price.
John Nyaradi is the author of The ETF Investing Premium Newsletter.