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Market Update

In the Repeat of Past, Latest Greek Deal Only Delays Inevitable

Author: Nichole Harper
Last Update: 2:44 PM ET July 13 2015

2:35 PM – World markets for now welcomed a tentative deal between European lenders and Greece. However, Greece is facing an uphill task in implementing unpopular reforms and reduce fiscal gap and lift revenues and the euro is likely to come under more pressure. Merger Monday saw three billion dollars deals.

Market indexes on Wall Street and in the euro zone advanced on the hopes that the last minute deal between European lenders and Greece will be approved by parliaments.

Greece agreed to several unpopular reforms and conditions that were rejected in a referendum by Greek citizens and in exchange European lenders offered to provide over three years as much as $95 billion.

The tough deal requires approval from several parliaments, euro zone finance ministers’ group and Greek lawmakers.

Though stock and currency markets welcomed the deal and bond market remained on the edge and several investors voiced skepticism.

Deadlines have come and gone as far Greece is concerned and the nation has a terrible record of implementing reforms in the last five years. Also, Greek government may face difficult lawmakers and the nation may face yet another general election as early as December.

On Wall Street, Tollbooth Strategy Index increased 0.9% or 104.74 to 10,830.30.

S&P 500 index gained 0.9% or 19.54 to 2,096.28 and the Nasdaq Composite Index increased 1.3% or 63.60 to 5,061.30.

Crude oil in New York slid 44 cents to $52.30 a barrel and gold fell $4.90 to $1,153 an ounce.

U.S. Movers

BorgWarner Inc (BWA) rose 37 cents to $54.01 after the auto parts maker agreed to acquire electrical components maker Remy International Inc. for $29.50 per share or about $950 million in cash.

Shares of Remy International Inc soared 41.9% to $29.13.

Black Hills Corp (BKH) decreased 1.8% or 79 cents to $46.05 after the energy company signed agreement to acquire natural gas utility provider SourceGas Holdings LLC for about $1.9 billion.

The deal is expected to close in the first-half of 2016.

Jarden Corp (JAH) jumped 4.6% or $2.41 to $54.73 after the consumer products maker said it plans to acquire the U.K.-based disposable tableware maker Waddington Group, owned by private equity firm Olympus Partners for $1.35 billion or £869 million.

MPLX LP (MPLX) tumbled 16.1% or $11.05 to $58 after the petroleum product transportation and storage services provider sponsored by Marathon Petroleum Corp plans to buy Markwest Energy Partners LP for about $20 billion, including the assumption of debt of approximately $4.2 billion.

Marathon Petroleum will contribute $675 million of cash to MPLX to fund the one-time cash payment.

The deal is expected to close in the fourth quarter.

Shares of Marathon Petroleum Corp soared 9.2% to $59.48.

Platform Specialty Products Corp (PAH) gained 22 cents to $25.36 after the specialty-chemicals maker agreed to acquire its U.K.-based small rival Alent Plc for about $2.09 billion or £1.35 billion to expand the business in the region and reduce the inventories.

European Markets

European markets extended Friday’s gain after Greece and international lenders hammered out a last minute agreement.

However, most international investors remained skeptical on Greece’s ability in implementing unpopular pension and tax reforms and widen tax net.

In London trading, FTSE 100 index gained 0.6% or 44.06 to 6,717.58 and in Frankfurt the DAX index increased 1.1% or 128.71 to 11,444.53.

In Paris, CAC 40 index jumped 1.7% or 81.04 to 4,984.11.

Alent Plc surged 43.7% to 485.32 pence after the U.S.-based chemicals maker Platform Specialty Products Corp plans to acquire the U.K.-based rival for about £1.35 billion or $2.09 billion to expand the business in the region and reduce the inventories.

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Sources: Data collected by 123jump.com and Ticker.com from company press releases, filings and corporate websites. Market data: BATS Exchange. Inc