US stocks ended sharply higher to end a volatile week mostly unchanged on optimism that the proposals submitted by Greece to its international creditors would pave the way for a possible bailout deal.
The Dow Jones Industrial Average rose more than 211.9 points or 1.2% to close the week at 17,760.80 .The blue-chip index eked out a 0.2% gain for the week despite selling off earlier this week on the Greek debt crisis and a slowdown in Chinese equities.
The benchmark S&P 500 index advanced 25.31 points or 1.2% at 2,076.2 points, its biggest one day gain in more than a month to end the week unchanged.
The technology heavy Nasdaq Composite rallied 75.3 points or 1.4% at 4,997, its biggest one day gain since January, but still ended the week 0.2% lower.
“A relief rally today makes sense as the impediments have been temporarily removed,” Larry Peruzzi, director of international trading at Cabrera Capital Markets LLC in Boston, told Bloomberg.
“Markets survived a combination of Greek and Chinese body blows and a standing four-hour count to come out swinging Friday.”
Euro zone Ministers are expected to meet on Saturday to deliberate over a third bailout deal for Greece.
The country has made significant concessions in its latest proposal to the lenders in hopes to receive a loan of $59 billion to help cover its debts for the next three years.
“Investors are betting that a Greek deal will be struck by this Sunday, and that reduction of risk is boosting stocks today. The removal of the risk of an exogenous shock means better market psychology,” Jim McDonald, who helps oversee $960 billion in assets as chief investment strategist at Northern Trust in Chicago, told Reuters.
US equities were also supported by a continued steadying of China’s stock market after weeks of gyrations causing heavy losses.
Chinese equities strengthened for a second consecutive day after comments by Premier Li Keqiang that Beijing would continue to make targeted policy changes to support its markets.
To contact the reporter of the story: Samuel Rae at firstname.lastname@example.org