Sharechat Logo

While you were sleeping: BusinessWire weekend wrap

Monday 24th November 2008

Text too small?
Stocks on Wall Street rallied strongly on Friday, sending the Dow Jones Industrial Average up more than 6% on reports President-elect Barack Obama has chosen the next Treasury secretary.

The late rebound followed a report on NBC news that Obama has tapped Timothy Geithner, president of the Federal Reserve Bank of New York, as his Treasury chief. The appointment boosted optimism the government will quickly reach agreement on how to use the remainder of the US$700 billion federal aid package.

The Dow Jones Industrial Average gained 6.5% to 8046.42 and the Standard & Poor's 500 Index rose 6.3% to 800.03. The Nasdaq Composite advanced 5.2% to 1384.35.

Alcoa led gainers on the Dow, surging 23% to US$8.44 as prices of metals including aluminium rebounded. Exxon Mobil climbed 11% to US$75.81 and Chevron rose 9.5% to US$70.49 after crude oil gained on OPEC's production cuts and optimism economic growth will revive, lifting fuel demand. Walt Disney gained 13% and Microsoft rose 12%.

Friday's rally wasn't enough to lift the US benchmark indexes from their third weekly slide on prospects of a deepening recession, delays to a bailout for automakers and concern that Citigroup will suffer further as the economy slumps.

Citigroup tumbled about 20% to US$3.77, bringing its slump this week to 60% on concern it will face more defaults by customers. The slump has stoked speculation that the US government will attempt some sort of rescue of Citigroup, which has US$2 trillion of assets and is regarded by some investors as too big to be allowed to fail.

General Motors rose 6% to US$3.06 on Friday after touching its lowest level since the 1930s last week. The automaker has sought federal assistance, saying it may run out of operating cash by year-end.

GM said it would shutter a truck plant in Ontario, Canada for early maintenance and extend down time at five other plants in North American to reduce output and inventory.

Leaders of the 21-nation Asia-Pacific Economic Cooperation group said after their summit in Peru that they would continue to take "extraordinary steps to stabilise our financial sectors and strengthen economic growth and promote investment and consumption."

Richmond Federal Reserve President Jeffrey Lacker said on Friday the US economy will probably halt its slide next year and there's a risk that inflation picks up as growth revives.

Reports of Geithner's appointment drove up the US dollar against the yen on optimism he has the skills to help steer the US through the financial crisis and economic slump.

The US dollar gained about 2% to 95.91 yen. The euro strengthened about 1% to $1.2582.

US Treasuries fell, driving yields up from 50-year lows as stocks rallied.

The yield on the 10-year Treasury notes rose 19 basis points to 3.19%. The yield on 30-year Treasuries surged 20 basis points to 3.68%.

Crude oil rose on Friday, snapping a five-day slide, on a report that the Organisation of Petroleum Exporting Counties will reduce supplies by 3.8% this month, as part of an agreement the cartel approved in October.

Venezuela will ask OPEC to cut oil output by 1 million barrels this year, according to that nation's Energy Minister Rafael Ramirez.

Crude oil for January delivery rose 1% to US$49.93 a barrel, trimming its decline last week to 13%.

Gold futures for December delivery rose 5.8% to US$791.80 an ounce in New York and was the biggest advancer on the Reuters/Jefferies CRB Index.

Copper futures rose as much as 4.2% as stocks rallied.

In Europe, the Dow Jones Stoxx 50 Index declined 3.2% to 1894.31. Germany's DAX 30 Index dropped 2.2% to 4127.41. Daimler fell 1.2% after the automaker said it is considering further cost cuts. The company as identified some 5,800 surplus jobs, according to union leaders.

France's CAC 40 fell 3.3% to 2881.26 as Societe Generale and Sanofi Aventis declined.

In London, the FTSE 100 Index fell 2.4% to 3780.96, led by AstraZeneca, tracking a slide in pharmaceutical companies across Europe on speculation investors have sufficient risk appetite to seek more cyclical stocks.

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

EROAD Limited (NZX: ERD) launches Clarity Solo Dashcam
22nd October 2021 Morning Report
Pictor ready to roll out game-changing COVID antibody test in New Zealand
Scott Technology Limited (NZX: SCT) Announces FY21 Results
21st October 2021 Morning Report
Greenfern Industries Limited (NZX: GFI) L&Q Notice
TruScreen Group Limited (NZX: TRU) Clinical Trial Results Highlight Efficacy of TRU Technology
20th October 2021 Morning Report
Freightways Limited (NZX: FRE) Acquisition of ProducePronto
19th October 2021 Morning Report