Today's Wall Street News Summary highlights the passage of Greek austerity legislation against the backdrop of massive Greek protests opposing the measure and the Hellenic Republic's government. The day also offered data on home sales and mortgage activity, as well as oil and gasoline inventory. On the corporate front, Bank of America and BJ Wholesale Club headed the wire.
Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.
Greece Passes Austerity Measures The Greek Parliament voted for the five-year austerity plan pushed upon them by the IMF and EU, despite incensed protests by the Greek people outside the building. It was a $40 billion value creating measure, raising taxes and cutting spending. The passage of the legislation allows the IMF/EU to release the next tranche of aid to Greece to allow it to remain solvent. It’s not over though, as Thursday brings a vote on the implementation procedures of the austerity measures. Meanwhile, Greeks are increasingly opposing their government, which they do not believe is representing their interests.
Mortgage Activity Eases The Mortgage Bankers Association (MBA) produced its weekly Mortgage Activity Report Wednesday in the premarket. This week’s data, covering the period ending June 24, showed mortgage activity eased despite rate improvement. The MBAs Market Composite Index dropped by 2.7% on a seasonally adjusted basis, while contracted 30-year fixed rate mortgage rates dropped moderately.
Pending Home Sales Turn Around in May The Pending Home Sales Index was reported for the month of May at 10:00 AM this morning. The data, produced by the National Association of Realtors (NAR), showed the Pending Home Sales Index rose 8.2% on a month-over-month basis, to a level of 88.8 in May. Pending Home Sales is a forward looking measure, which measures contract signings, so more good news for housing. Also, each region reflected the improvement seen overall.
Oil & Gasoline Inventory Data The EIA Petroleum Status Report, released at 10:30 AM, showed both crude oil and gasoline stores experienced draws from inventory in the period ending June 24. Crude oil inventory fell by 4.4 million barrels and remains at a level above the upper limit of the average range for this time of year. These draws do not include draws from the strategic petroleum reserve. Total Motor Gasoline inventory decreased by 1.4 million barrels and fell to the middle of the average range for this time of year.
Federal Reserve Governor Sarah Bloom Raskin is giving a speech on rebuilding the American economy in Washington D.C. at 12 PM ET.
Farm Prices, which covers all agricultural products, will be reported at 3:00 PM.
Wall Street was in focus, as Bank of America (NYSE: BAC) came to a settlement agreement and has set aside $14 billion dollars to reimburse those harmed by mortgage backed securities it and its subsidiaries (Merrill Lynch) sold. Of this amount, $8.5 billion will be immediately paid out to heavy hitter investors like PIMCO.
BJ Wholesale Club (NYSE: BJ) agreed to be taken private today by Leonard Green & Partners and CVC Capital Partners at a price of $2.8 billion. That translates into $51.25 per share for shareholders of BJ.
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