Markets are looking a bit indecisive this morning in the U.S., with futures markets pointing to a slightly higher open despite a strong midday rally taking place overseas. The FTSE 100 index is trading 1.4% higher as of this writing. Asian markets were mixed overnight, with the Hang Seng down 0.6% and the Nikkei booking a slight gain on the day.
Given a few more moments, the Dow Jones Industrial Average (INDEX: ^DJI) would have booked a slight gain on the day yesterday, yet the index fell 6.7 points to 12,496 after being down as much as 191 points before some late-inning heroics. The final-hour rally was driven by optimism that European leaders are finding common ground in plans to stave off contagion in the case that Greece defaults and exits the euro.
Make it stop
Tired of the incessant noise from overseas? It's about to get much louder over the next month as Greece prepares for elections to take place on June 17. The election will be crucial for the fate of Greece as the left-wing Syriza party and the conservative New Democracy party battle to form a majority government. Greek default is looking increasingly inevitable, but a Syriza victory would likely put a nail in the coffin and divert attention to countries like Ireland, Portugal, Spain, and even Italy. With their respective GDPs five and seven times larger than that of Greece, a crisis in Spain or Italy could be disastrous for the weakened European economy.
Around the Dow
Hewlett-Packard (NYSE: HPQ) will steal the limelight among Dow components today, overcoming the Dell-fueled naysayers (including yours truly) by booking somewhat encouraging results after the close. Sentiment was so bad yesterday in reaction to Dell's results that it caused a widespread sell-off in all things touching the PC. Yesterday, Intel (Nasdaq: INTC) and Microsoft (Nasdaq: MSFT) saw shares fall 2.3% and 2.2%, respectively, on derivative Dell doldrums. We'll see if they receive equivalent treatment in reaction to HP's announcement, which has its shares up about 10% in premarket trading. As we all know, Wall Street is addicted to cost-cutting, and when you throw around numbers like $3.5 billion in cost savings, beat quarterly earnings estimates, and up annual guidance, traders start getting all giggly and hit the "buy" button. Moreover, the lack of horrible news was considered the biggest positive, and when your stock price is as beaten down as HP's, sometimes that's all that it takes for a big rally.
In other Dow news, McDonald's (NYSE: MCD) hosts its annual shareholder meeting today. While not typically a notable event, this meeting will be the last for CEO Jim Skinner, who plans to step down at the end of June following an eight-year reign. Picking up for Skinner is current president and COO Don Thompson, who has his work cut out for him, succeeding a CEO who saw McDonald's stock price soar more than 250% on his watch.
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