Optimism on EZ Crisis Resolution, Probably Too Much

Obviously, the rebound in market sentiment was driven by hopes the European policymakers would soon announce new measures that would effectively solve the sovereign debt problems in the Eurozone. We suspect investors were overly optimistic. Led by European bourses on Greek parliament's approval of a new property tax, Wall Street jumped in early session with DJIA soaring over +300 points at one occasion. Gains were pared later in the day as EU's Jean-Claude Juncker stated he was 'very worried' about the situation in Greece and a FT report unveiled that the European private sector may need to take a larger write-down on Greek debts than previously expected.

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Optimism on EZ Crisis Resolution, Probably Too Much