Wall Street up as Greek pro-bailout parties gain support


Wall Street advanced on Tuesday, with equities again taking their cue from overseas markets as Greek election polls pointed to support for pro-bailout parties, overshadowing a weak read on U.S. consumer confidence.
Facebook Inc (FB.O) shares continued to fall, contributing to weakness in the tech-heavy Nasdaq Composite Index. They hit a new low of $30.02, dropping about 6 percent on talk it was in discussions to buy Oslo-based Opera Software (OPERA.OL), while analysts said competition from Google Inc (GOOG.O) and others could push the price tag of any deal above $1 billion.
Weekend polls in Greece showed the conservative New Democracy party, which backs the country’s international bailout, has a lead over the leftist SYRIZA party, which opposes it ahead of a June 17 election. Opposition to the bailout has raised the specter of Greece leaving the euro zone, a prospect that has weighed on stocks in recent weeks.
In Ireland, voters appear poised to reluctantly approve the EU fiscal treaty on Thursday.
“Any event that helps eliminate uncertainty in Europe is a good thing. The election (polling) suggests that Greece will toe the line” necessary for the bailout, said Jon Merriman, chief executive officer at investment firm Merriman Holdings Inc in San Francisco.
Investors were also looking to possible new stimulus from China. The Shanghai Securities News, citing unnamed sources, reported that China’s biggest banks appeared to have accelerated lending toward the end of this month as Beijing starts to fast-track its approval of infrastructure investments in an effort to stem sagging growth.
The Dow Jones industrial average .DJI was up 100.47 points, or 0.81 percent, at 12,555.30. The Standard & Poor’s 500 Index .SPX was up 9.80 points, or 0.74 percent, at 1,327.62. The Nasdaq Composite Index .IXIC was up 21.05 points, or 0.74 percent, at 2,858.58.
Investors shrugged off a private sector report which showed U.S. consumer confidence unexpectedly cooled in May, falling to the lowest level in four months as Americans became more pessimistic about the job market and economic outlook. The report is one of the first in an abbreviated week heavy on economic data, culminating in Friday’s payrolls report.
U.S. markets were closed on Monday for the Memorial Day holiday.
Concern about Spain’s banking system continued to be monitored as yields on 10-year Spanish bonds remained just under 6.5 percent. Many investors view the 7-percent mark as unsustainable, which could trigger the need for a bailout.
The S&P/Case Shiller composite index of U.S. single-family home prices edged 0.1 percent higher in 20 metropolitan areas in March on a seasonally adjusted basis, falling short of economists’ forecasts for a gain of 0.2 percent. However, it was the second consecutive month of gains which could indicate stabilization in the housing market.
Vertex Pharmaceuticals Inc (VRTX.O) plunged 15 percent to $55 as the biggest drag on the Nasdaq 100 index .NDX after the drugmaker released corrected data involving its cystic fibrosis treatments on Tuesday that lowered the number of patients who showed certain levels of improved lung function.
Defense equipment manufacturer Teledyne Technologies Inc (TDY.N) said it would buy LeCroy Corp (LCRY.O) for $240.5 million in cash to add more products to its portfolio. LeCroy shares surged 55 percent to $14.18 while Teledyne advanced 0.7 percent to $60.23.