Wall Street surges on Greek deal; tech stocks rally

By Noel Randewich

(Reuters) - U.S. stocks surged on Monday, with the Dow Jones industrial average re-emerging in positive territory for the year after euro zone leaders reached a tentative deal to bail out Greece.

The improved picture in Europe also put the Nasdaq composite on track for its best three-day run in 2015, while the S&P 500 headed for its best three-day run in five months.

The technology index <.SPLRCT> led the market higher, with Facebook , Netflix and Amazon all hitting record highs, while Apple's 1.6 percent rise gave the biggest boost to the Nasdaq.

Greece won conditional agreement to receive a possible $95 billion over three years, along with an assurance of talks to bridge a funding gap until a bailout is finally ready. The deal is contingent on Greece meeting a tight timetable to enact reforms of value added tax, pensions and budget cuts.

 

"Headlines out of Greece are going to dissipate a bit and with that the U.S. earnings picture is going to start to emerge as the important factor," said Mike Binger, a portfolio manager at Gradient Investments in Shoreview, Minnesota, with $850 million under management.

Also making Wall Street more confident, Chinese stocks rose for a third straight day as data showed exports rose while imports slipped in June, a tentative sign global demand might be on the mend.

Pointing to expectations of calmer trading, the CBOE Volatility index <.VIX> fell 16 percent on Monday. Its 29 percent decline in the past two sessions is the largest two-day drop since Jan. 2, 2013.

The Dow Jones industrial average <.DJI> rose 189.77 points, or 1.07 percent, to 17,950.18, the S&P 500 <.SPX> gained 19.38 points, or 0.93 percent, to 2,096 and the Nasdaq Composite <.IXIC> added 65.28 points, or 1.31 percent, to 5,062.98.

Nine of 10 major S&P 500 sectors were higher, with utilities <.SPLRCU> weaker as the Greece deal boost U.S. Treasury yields. The financial index <.SPSY> rose 0.83 percent. Upcoming quarterly earnings reports from banks are expected to benefit from a recent rise in long-term yields relative to short term yields.

Oil prices tumbled as Iran and six world powers closed in on a nuclear deal that would end sanctions on Iran, allowing more oil onto the market. The energy index <.SPNY> stayed in the black but has been the worst-performing S&P sector over the last month, falling over 5 percent.

However, the oil slide boosted U.S. airline stocks <.DJUSAR>. American Airlines , United Continental , JetBlue and Alaska Air were all up between 1 and 3 percent.

Apple rose 1.7 percent, and was up 4 percent in the last two days for its best back-to-back run since the end of January.

Markwest Energy Partners was up 11.7 percent at $66.80. MPLX , Marathon Petroleum's master limited partnership, said it will buy the natural gas processor for about $15.63 billion. MPLX was down 16.6 percent at $57.88 while Marathon rose 7.8 percent to $58.76.

NYSE advancing issues outnumbered decliners 2,129 to 910. On the Nasdaq, 1,951 issues rose and 832 fell.

The S&P 500 was posting 40 new 52-week highs and 10 new lows; the Nasdaq was recording 142 new highs and 39 new lows.

(Additional reporting by Tanya Agrawal, editing by Savio D'Souza)