Confusion out of Europe regarding Greece and a surprise interest rate cut roil world markets.
New European Central Bank President Draghi started off with a bang by lowering interest rates for the first time in two years but the bond market didn’t share in the celebration as Italian 10 year bonds (NYSE:EWI) hit a Euro era high of 6.4% and Greek 10 years hit 31%.
But gold (GLD) liked the news and registered a 1.6% gain to a six year high and the G20 continued their dramatic meeting in Cannes.
The economy showed modest signs of improvement with weekly unemployment dropping below 400,000 and a rise in factory orders.
Tomorrow brings the all important Non Farm Payrolls and Unemployment reports.
Bottom line: From both a technical and fundamental perspective, the U.S. stock market wants to go up but Greece and Europe, particularly Italy’s $1.9 Trillion in debt remain significant potential potholes.
Disclosure: No positions in ETFs or stocks discussed in this article.
John Nyaradi is the author of The ETF Investing Premium Newsletter.