Dow Crosses 12K on Eurozone Deal

Investors optimistic after Greek debt cut, rescue fund expanded
By Rob Quinn,  Newser Staff
Posted Oct 27, 2011 4:26 AM CDT
Updated Oct 27, 2011 9:02 AM CDT
UBS predicts that the euro will continue to perform well, at least in the short term.   (AP Photo/Michael Probst)

(Newser) – Will the debt crisis deal reached by European Union leaders help get the world economy back on track? Investors around the globe seem to think so. The Dow jumped 247 points at the open, to 12,116. The S&P 500 and Nasdaq rose 32 and 68 points, respectively, reports MarketWatch. The more than 2% boosts follow increases worldwide: Asian markets rose after news of the deal was announced and European markets opened firmly higher today, with the euro rising to a seven-week high against the dollar. Copper prices also rose and oil was up by $2 a barrel.

The agreement to boost the firepower of the EU's rescue fund "will build a firewall between Greece and the rest," a BNP Paribas analyst tells Reuters. "With the agreement on a 50% haircut for Greece, quite a bit of uncertainty has been taken off the table as well. It was very important to convince the market that this is a good plan. The restoration of confidence is an important step in the healing process. However, we will see whether the recovery in risky assets has legs."

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