August 19, 2022

Optimism on Greece Pushes Stocks Higher

Greek lawmakers passed an austerity bill that would allow international lenders to release more emergency loans. Meanwhile, in Germany, banks and insurance companies joined the government in a plan to roll over holdings of Greek debt. The news added to optimism about averting a widespread European debt crisis, which has sent markets higher since Monday.

However, a report on claims for American jobless benefits was less encouraging. Worries about the economy and job growth have pushed stocks lower since late April.

Major indexes could eke out a small three-month gain as a volatile quarter comes to a close. The Dow was up 0.6 percent for the three-month period ending in June, but the Standard Poor’s 500-stock index was down 0.5 percent.

In early afternoon trading Thursday, the Dow Jones industrial average rose 121.74 points, or 0.99 percent, to 12,383.16. The Standard Poor’s 500 gained 10.65 points, or 0.81 percent, to 1,318.06, and the Nasdaq composite index added 28.95 points, or 1.06 percent, to 2,769.04.

In Washington, the Labor Department said that slightly fewer people applied for unemployment benefits last week compared with the week before, but the level of claims was still high, at 428,000.

The previous week, applications had jumped to a one-month high. New unemployment claims have stayed above 400,000 for 12 straight weeks, a sign that companies are not hiring at a rate that can sustain job growth. The slowdown in hiring has caused concerns that the economy will take longer than expected to return to health.

Applications had fallen in February to a level that economists consider healthy, but surged in April to an eight-month high.

In Europe on Thursday, stock indexes also jumped after the Greek vote and German bank deal. Germany’s benchmark DAX index closed up 1.1 percent. The FTSE 100 index of leading British shares and France’s CAC 40 both rose 1.5 percent.

On Wednesday, strong signs Greece would pass its austerity bill and a Bank of America settlement over failed mortgage securities pushed stocks higher for a third straight day. The Dow rose 72.73 points, or 0.6 percent, to close at 12,261.42, and the S. P. 500 index rose 10.74, or 0.83 percent, to 1,307.64.

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