The US equity markets ended higher for a third-consecutive session, led by banks, amid end-of-quarter window dressing and after the Greek parliament approved austerity measures to avoid a debt default. The CBOE volatility index tumbled 10%.
The Dow Jones Industrial Average rose 72.73 points or 0.60%, to close at 12,261.42 and NASDAQ Composite gained 11.18 points or 0.41%, to end at 2,740.49. The S&P 500 Index went up 10.74 points or 0.83%, to settle at 1,307.41.
On economic data front, pending home sales rose more than expected in May. However, weekly mortgage applications slipped last week amid weakening demand.
In economic data one should watch out for, initial jobless claims for the week is expected to decline to 420,000 as compared to 429,000 recorded during the previous week.
Also, the Chicago PMI data for June is expected to come out today. Consensus figures stand at 53, a decline in business activity as compared to May which posted 56.6.
But the debt threat is still rising. US President Brack Oama called for more stimulus to spur job creation. The move widely would complicate the budget talks with republicans for demanding further belt tightening. Oama said that he was confident the deal to raise the debt ceiling could be done by the second of August.
US President Barack Obama said, "Nobody wants to see the US default. So we have got to seize this moment. We have to seize it soon. I am not engaging in scare tactis. I have tried to responsible and somewhat restrained so that folks don't get spooked. August 2 is a very important date and there is no reason why we can't get this done now.
European markets shut shop at two-week closing highs after the Greek parliament approved the austerity package. Investors are hopeful that the second vote would pass on later today to secure the next tranche of aid. France's CAC, Germany's DAX and Britain's FTSE closed 1.5-2% higher.
Greece's parliament approved a five-year austerity plan with 155 votes in favour and 138 votes against. The government managed to push through the first part of the USD 112 billion austerity plan. It now has to win approval for legislation detailing specific implementation measures.
In the currency space, euro rises to a two-week high versus the dollar on speculation that the European Central Bank will increase interest rates next week after the immediate risk of default by Greece subsided.
Crude gains more than 3% as sharp drawdowns in US crude and gasoline stocks fed a rally spawned when Greece passed an austerity plan to avoid a sovereign debt default.