Global stock markets showed mixed results on Tuesday after Greece agreed to a bailout program that would see the country enforce more austerity policies. European stock markets have erased some previous gains as optimism surrounding Greece began to fade. Greece struck a preliminary deal that should help the country avoid financial catastrophe but would include austerity measures and increased hardship for people. The deal would remove any immediate threat of a default and is scheduled for a vote in the Greek parliament today. The French CAC 40 declined 0.2%, as nearly half of the components were lower to trade at 4,993.69. The German DAX declined 0.5% as major exporters such as BMW (XETRA:BMWG) , Daimler (LONDON:0NXX) and Volkswagen (XETRA:VOWG) tumble 1.1-2.8%. The Italian FTSE MIB declined 1% as nearly all components decline. Financial corporations such as Banca Popolare di Milano Scarl (MILAN:PMII), Unicredit (MILAN:CRDI) and UBI Banca (MILAN:UBI) fell between 0.8 and 1.7%.
In the meantime, U.S. stock markets saw gains after the release of disappointing retail sales data. Core retail sales have declined about 0.1%, a far cry from the expected 0.4% growth. The unexpected drop helped lift stocks as the Federal Reserve’s data-dependent position on an interest rate hike was taken into consideration. An interest rate hike would strengthen the dollar and possibly hurt major exporters, making the negative retail sales a boon for Wall Street. Investors will be keeping a close eye on Federal Reserve Chair Janet Yellen for any clues on a rate hike later in her congressional testimony due later today. The S&P 500 Index added 0.45% to close the session at 2108.95; the Dow Jones Industrial Average added 0.42% to trade at 18053.58 and the NASDAQ outperformed with a 0.66% gain to trade at 5104.89.
Oil futures were higher when it became apparent that the upcoming deal between the six global powers and Iran would not immediately remove sanctions that relate to Iranian crude oil export. Both Crude and Brent oil added around 0.2% to trade at $53.14 and $58.65 per barrel, respectively.
Investors will be keeping a close eye for any clues about a U.S. interest rate hike in Federal Reserve Chair Janet Yellen’s congressional testimony early in the session. The Energy Information Administration (EIA) is scheduled to release its U.S. crude oil stockpile report.
Chinese GDP data will release later in the session.