Wall St. rallies late on Greek deal hopes; energy gains

Friday's rout was followed by today's boom, which I suspected would be the case since the entire rout happened in a panic in the last hour of trading on Friday.  It was also quite a tumultuous day with the Dow dropping 150 points right out the gate, then rallying more than 300 points for the rest of the session.  Friday's panic was caused by a statement from Greece saying "no cooperation with the EU," so it made sense that today's big rally was caused by yet another statement from Greece saying "cooperation with the EU."  That's right, after months of Syriza campaigning for what they have dubbed the "Grexit" from the EU, it took just one day of global crash-and-burn to change their minds.  Today, Greece proposed a compromise solution with the EU that has them swapping their debt for new growth-linked bonds.  Everyone's happy now - Greece, the EU bankers, global investors - and the Dow shot up 196 points.  Energy also continued its Friday rally today, the index up another 3% and crude rising nearly as much and now already back to just under $50/barrel.  On the downside, though Friday's reports showed a big rise in consumer confidence, today's reports show a big disappointment in consumer spending.  One day, one bad report, and they're already predicting that the savings from oil will not translate into more consumer spending.  Volume was quite healthy at 7.7 billion shares.

Wall St. rallies late on Greek deal hopes; energy gains

BY CAROLINE VALETKEVITCH

DJ:     17,361.04  +196.09      NAS:      4,676.69  +41.45       S&P:      2,020.85  +25.86

NEW YORK Mon Feb 2, 2015 4:58pm EST

(Reuters) - Stocks ended sharply higher on Monday after a late rally driven by hopes for a Greek debt deal and as energy shares bounced with oil prices.

Greece's new government has proposed ending a standoff with its international creditors by swapping its outstanding debt for new growth-linked bonds, Finance Minister Yanis Varoufakis was quoted as saying on Monday.

Adding to the day's advance were energy shares, with the S&P500 energy sector .SPNY ending up 3 percent. U.S. crude CLc1 settled up 2.8 percent at $49.57 a barrel, despite a strike at U.S. refineries that could boost crude supply.

The sharp move higher came late in a session where the S&P 500 repeatedly moved between positive and negative territory.

"Markets are finding some comfort in the fact there is a dialogue that has the potential to lead to something other than a Grexit. That is a constructive narrative for equity markets, not just in the U.S. but globally," said Peter Kenny, chief market strategist at Clearpool Group in New York. "Grexit" refers to the possibility ofGreece exiting the euro zone.

The Dow Jones industrial average .DJI rose 196.09 points, or 1.14 percent, to 17,361.04, the S&P 500 .SPX gained 25.86 points, or 1.3 percent, to 2,020.85 and the Nasdaq Composite .IXIC added 41.45 points, or 0.89 percent, to 4,676.69.

The gains also follow the worst monthly performance for the indexes in a year.

Shares of Exxon Mobil (XOM.N) were up 2.5 percent at $89.58 after it reported a smaller-than-expected profit drop. The results follow several disappointing earnings results from many multinational companies.

Disappointing readings on consumer spending and the manufacturing sector weighed on the market early in the session.

The pace of growth in the U.S. manufacturing sector slowed more than expected in January. U.S. consumer spending recorded its biggest decline since late 2009 in December, with cheaper gas not translating to higher activity.

Solar power companies were among the strongest of the day after China said it aims to install 15 gigawatts of solar power capacity this year, 43 percent more than it added in 2014. First Solar (FSLR.O) climbed 7.5 percent to $45.48.

About 7.7 billion shares changed hands on U.S. exchanges, above the 7.4 billion average for the last five sessions, according to BATS Global Markets.

NYSE advancing issues outnumbered decliners 2,271 to 821, for a 2.77-to-1 ratio; on theNasdaq, 1,746 issues rose and 987 fell, for a 1.77-to-1 ratio favoring advancers.

The benchmark S&P 500 posted 4 new 52-week highs and 6 lows; the Nasdaq Composite recorded 25 new highs and 82 lows.