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Jun 24 2015

Equity Futures Are Moving Lower This Morning

Market Recap 6/23/15:

Once again, optimism surrounding a possible deal preventing a Greek default spurred the markets forward. Unlike Monday’s session however, trading yesterday was choppy and the market’s gains were merely modest. Economic data on the day was mixed with disappointing durable goods data being weighed against better than expected new home sales numbers. Much of the decline in orders came from a decrease in aircraft orders and flat sales of motor vehicles. Excluding transportation data, durable goods actually increased by .5%. Meanwhile, new home sales reached its highest levels since February of 2008. This development, along with multi-year highs for existing home sales, points to a housing market that is rebounding quite nicely and building momentum. At the end of the day, markets moved slightly higher with the leader, the Russell 2000, only rising by .26%. The ten S&P sectors were more of a mixed bag with five closing higher on the day and five closing lower. Telecom was the biggest gainer, rising by 1.3%, while Utilities fell by the same amount and lagged.

Looking Ahead:

Equity futures are moving lower this morning after reports that Greek Prime Minister Alexis Tsipras has told associates that Greece’s latest proposals were once again rejected by creditors. With much of the week’s positive action spurred by optimism that a deal was going to take place; it is no surprise that a breakdown in the talks is sending equities the other way. In their own report, the Wall Street Journal said that there are still “significant divisions” that remain between the Greeks and their creditors until they can further access bailout funds. These divisions include a set of laws that the Greek parliament would have to pass before they can access the funds. European leaders including German Chancellor Angela Merkel are very adamant that at least some of these actions must be complete before an agreement takes place. If a deal isn’t reached by the end of this month, Greece will default on a 1.55 billion euro payment owed to the International Monetary Fund on June 30. While investors digest these overnight global developments, they are also anticipating the release of the final estimate of first quarter GDP. GDP, which was revised to show a contraction of .7% during the second estimate, is expected to be revised upward to a show a contraction of .2%. Any surprise to the upside could be a positive catalyst for today’s trading.  Make sure to listen to Money Matters with Gary Goldberg this Sunday at 11:00 AM on WOR 710 AM Radio to hear our latest economic and market analysis. Visit our website for details.