“Global stocks tumbled Monday after Greece closed its banks and limited the amount of money citizens can withdraw from them after bailout talks with its creditors broke down over the weekend,” Aaron Task reports for Yahoo Finance. “The Greek drama has been unfolding for many months (if not years) but the latest developments revived fears the country could exit the euro zone, with unpredictable consequences.”
“The Dow fell nearly 350 points, or 1.9%, while the S&P 500 lost 2.1% and the Nasdaq tumbled 2.4%,” Task reports. “European stocks suffered their biggest drop in eight months with Germany’s DAX and France’s CAC each falling about 3.5% while major bourses in Spain and Italy fell more than 4.5%. The stock market in Greece was closed but the FTSE Greece 20 ETF, a U.S.-based proxy for Greek equities, fell 19%.”
We’ll see if the Greek people in response to the chaos that is now taking place will vote yes on the referendum instead of having its new Marxist government take them over the cliff on the platform that the private sector should exist to finance a bloated public sector with very generous benefits. That said, a debt write down is an inevitable component of what is a needed restructuring and a no vote (if they can someone stay in the euro after) would quicken that likelihood. On the other hand, if the referendum is essentially a vote on whether to stay in the euro or not (which it seems it will be), a yes vote must take place for the sake of the Greek people. A debt restructuring will then happen eventually anyway. — Peter Boockvar, chief market analyst at The Lindsey Group
“In addition to the Greek news, Puerto Rican Gov. Alejandro Garcia Padilla put additional pressure on stocks by telling The New York Times the island’s debt was “not payable,” raising the specter of default across the Atlantic as well,” Task reports. “But there’s no such thing as a free lunch, as the saying goes; Monday afternoon, the White House said no federal bailout of the U.S. territory will be forthcoming and Puerto Rico cannot declare bankruptcy, as Detroit and other municipalities have done, unless Congress acts to change the law.”
Read more in the full article here.
MacDailyNews Take: Shares of Apple Inc. (AAPL) closed down $2.22 or -1.75%, at $124.53.
Hopefully, Apple’s buyback program is taking advantage of the summer sale.