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Midday Market Update

Stocks Mixed Ahead of Earnings Kick-Off

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U.S. Market    
Stocks were mixed at midday as investors prepared for the unofficial start of the summer earnings season when  Alcoa (AA) reports its quarterly results after today's closing bell. 

Treasury prices increased this morning, recovering some losses from Friday's sell-off on account of a better-than-expected employment report. But speculation of the Fed tapering its bond-buying program has created forecasts for a jump in the Treasury yield during the next three years. 

Meanwhile, the European Commission, European Central Bank, and International Monetary Fund agreed to a tentative deal with Greek politicians on conditions for further funding for the country's financial rescue plan. The deal calls for thousands of job cuts in the public sector, leading to further protests, but it also is another step toward the next tranche of funding Greece can receive from the troika. The country's bailout is a key item of discussion during today's meeting of eurozone finance ministers. 

The Dow was 0.4% higher at midday, and the S&P 500 had gained 0.3%. The Nasdaq was down by 0.1%. 

Stocks on the Move
 Intel (INTC) shares had lost 3.6% by midday after a Wall Street analyst cut his outlook on the firm, citing a weak PC environment as a headwind for the chipmaker. 

 Dell (DELL) shares were up by 2.9% at midday as Institutional Shareholder Services recommended that Dell shareholders vote in favor of CEO Michael Dell's $24.4 billion private takeover bid of the tech firm. The ISS statement criticized the buyout proposal from activist investor Carl Icahn, who himself has been critical of Michael Dell's offer

Foreign Markets
European stocks were higher ahead of corporate earnings and on account of the aforementioned finance minister meeting. The DAX was up by 2.1% at midday, and the Paris CAC had gained 1.9%. The FTSE 100 was 1.2% higher. 

Stocks in Asia, however, were weak with investors preparing for Chinese inflation data Tuesday. The Shanghai Composite lost 2.4%. The Nikkei 225 fell by 1.4%, while the Hang Seng ended 1.3% lower. 

Kevin O'Shaughnessy does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.