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Stocks close at new record highs as Greece gets a bailout extension

February 20, 2015, 9:04 PM UTC

U.S. stock indexes soared to new record highs Friday after Greece reached an agreement with Eurozone officials to extend the struggling country’s bailout by four months.

Both the Dow Jones industrial average and the S&P 500-stock index climbed to new intraday record highs in afternoon trading on news of the Greek deal, which extends the country’s financial rescue for another few months. Investors around the globe have shown their concern over the possibility that an extension could not be reached, which could have sent Greece into bankruptcy and resulted in the country withdrawing from the Eurozone.

The Dow and the S&P index both closed at new record highs.

Greece’s deal with a group of European financial ministers requires that the country submit by Monday a list of fiscal reforms its government plans to enact as part of its bailout agreement, Reuters reported. Greece’s creditors will have until the end of April to approve the policy measures.

In the U.S., the stock market reacted to news of the bailout extension with a swift rebound after an early morning sell-off. The Dow dropped more than 100 points in early trading on investors’ concern over the European negotiations. However, the blue-chip index ended the day in record territory, gaining 155 points, or 0.9%. The index topped its previous record close, which it reached at the end of December.

Meanwhile, the benchmark S&P 500 captured its third record close in the past week by gaining 13 points, or 0.6%. The index, which crossed the 2,000-point mark for the first time ever last summer, finished just a handful of points above the previous record close it posted earlier this week.

The Nasdaq composite also improved Friday. The tech-heavy index has climbed to its highest levels in about 15 years and is steadily closing in on its own all-time high of 5,132 points, which it hit in 2000 before the dot-com bubble burst.

Friday’s gains cap off yet another strong week for U.S. stocks, which started off 2015 in rough fashion with overall losses for the month of January. February has been another story, though, as the broader market rebound has erased each of the major indices’ yearly losses. Just ahead of closing Friday, the Dow was up 2% for the year while the S&P 500 had gained almost 3%. The Nasdaq is up almost 5% on the year.

The Greek bailout extension came after the close of European markets, but London’s FTSE 100 and Germany’s DAX each gained about 0.4% on the day.