Friday 19th September 2008
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Financial stocks rebounded. Wachovia Corp. gained 59%, Citigroup rose 19% and Bank of America Corp. advanced 12%.
The S&P 500 rose 4.3% to 1206.51, climbing back from a 4.7% drop the previous day. The Dow Jones Industrial Average rose 3.9% to 11019.69 and the Nasdaq Composite Index advanced 4.8% to 2199.10.
Government agencies and major central banks have stepped in calm roiled financial markets and add funds to a banking system that's gone into a freeze. Central banks injected US$247 billion into the system.
Meantime, more evidence emerged on the extent of the US economy's slowdown. The Conference Board's index of leading indicators fell 0.5%.
Gold rose to as much as US$926 an ounce, rounding out a record two-day rally. The precious metal is still down on the year, having reached a record $1,030.80 in March.
Crude oil also gained a second day on optimism about moves to neutralize the financial crisis and concern about disruptions to US supply from successive hurricanes. Oil for October delivery rose 0.7%, to settle at $97.88 a barrel on the New York Mercantile Exchange.
The US dollar gained against the yen on the prospects of a US rescue agency.
The dollar strengthened to 105.51 yen in New York, from 104.66 yesterday. The dollar gained 0.1% to $1.4307 per euro.
US Treasuries fell as demand for the safest securities waned. The Treasury and Federal Reserve are considering a permanent plan to tackle the financial crisis, US Senator Charles Schumer said, according to Bloomberg News.
Two-year notes rose 12 basis points to 1.76%. The 10-year note also gained 12 basis points, reaching 3.53%.
European bonds also fell as central banks coordinated their efforts to bolster liquidity in money markets. The 10-year bond rose 3 basis points to 4.04%.
European stocks declined, paced by Pernod-Ricard SA after the company reported slowing profit growth. The Stoxx 600 Index fell 0.5% to 256.77.
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