Don’t read much into this week’s rally–much/most/all of it is a result of shorts taking their profits before the Greek vote on Sunday

Think of it this way. Right now nobody is long Greece. Nobody has been going long Greece in the last few days. And I think that goes for Spain and Italy and France and Ireland too. But bears that have been short Greece and the other parts (or all) of the EuroZone aren’t piling on more bets on a disastrous Greek vote on Sunday either. Instead their taking profits, which drives up prices of financial assets in the short run

U.S. stocks rally on bad unemployment claims number on theory that the news makes the Fed more likely to act next week

Today’s report on initial claims for unemployment continued a string of disappointingly weak results pointing to a slowdown in the jobs market. Initial claims for the week that ended on June 9 rose to 386,000 from an upwardly revised 380,00 for the week that ended on June 2. Economists had projected that initial claims would fall to 375,000

Italian yields surge at auction today as bond buyers say, loudly, that the Spanish bank bailout isn’t enough

Well, at least, European leaders, as they prepare for their end of the month summit, are under no illusion that the proposed bailout for Spain’s banks was enough to hold the crisis at bay. In today’s brutal Italian bond auction yields for one-year government debt hit 3.972%. That’s a six-month high and well above the 2.34% yield at the auction for one-year paper on May 11