Global shares rally on hopes for Greek deal; U.S. yields rise
By Sam Forgione
NEW YORK (Reuters) - U.S. and European shares advanced on Tuesday on hopes for a debt agreement between Greece and its major creditors, while U.S. Treasury yields rose on continued expectations of a Federal Reserve interest rate hike this year.
The U.S. benchmark S&P 500 rallied more than 1 percent, even as declining oil prices pushed the S&P energy index .SPNY down a modest 0.19 percent.
European Commission President Jean-Claude Juncker stepped up contacts with Greece's new leftist leader to try to bridge differences on the country's debt crisis but EU officials cautioned against expecting a breakthrough this week. Earlier, reports of a possible agreement helped shares rebound ahead of a meeting of the bloc's finance ministers Wednesday.
German Finance Minister Wolfgang Schaeuble, however, denied Greece had come to an agreement with the Commission and said the ministers would not negotiate a new program.
"The market is news-hungry for an event to take the market higher, and there's so much nervousness about Greece, that even the hope that they might be discussing some agreement got the market going," said Margaret Patel, senior portfolio manager at Wells Capital Management in Boston.
Coca-Cola Co (KO.N: Quote) shares boosted the Dow and the S&P 500 after the company reported a bigger-than-expected profit and its first increase in North American sales, its biggest market, in four quarters. Shares closed up 2.8 percent at $42.40.[ID:nL1N0VK28J]
U.S. Treasury yields rose, with those on benchmark 10-year notes US10YT=RR surpassing 2 percent to their highest in a month on heightened expectations that the Fed, the U.S. central bank, would hike rates from rock-bottom lows this year after strong U.S. jobs data last Friday.
"As far as the first rate, June is definitely more in play," said Edward Acton, Treasury strategist at RBS Securities in Stamford, Connecticut. Continued...