Wednesday, May 9, 2012
It’s all about Greece. Today’s trading action may not be as volatile as the one on Tuesday, but the end result may not be much different. With the domestic news flow lacking in substance, negative Greece and European stories have taken center stage.
There are growing fears that the weekend election may have put the country on course to exit from the Euro-zone. This prospect that some have started calling ‘Grexit’ has serious implications for the union and world economy. We will know in the next few days which way the Greek political system is evolving, but short of making the Greek citizens go through the election exercise all over again, we probably need to take ‘Grexit’ seriously. I hope that leaders in Brussels and Berlin are willing and ready to protect Spain and Italy should it come to that.
We don’t have much on the domestic economic calendar today. In corporate news, GlaxoSmithKline (GSK) is going hostile in bid for Human Genome Sciences (:HGSI) after its earlier bid was rejected. The company plans to take a $2.6 billion bid directly to Human Genome shareholders. In Earnings news, Disney (DIS) came out with better than expected top-and bottom-line results after the close on Tuesday. We have Cisco (CSCO) reporting after the close today.
Director of Research
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