Sharechat Logo

While you were sleeping: BusinessWire weekend wrap

Monday 14th July 2008

Text too small?
Panic about the potential collapse of Freddie Mac and Fannie Mae, the two largest US mortgage companies, led to an erratic day of trading on Friday which ended with more losses on Wall Street.

There was speculation that the Federal Reserve could announce a rescue plan for the two companies before trading resumes on Monday, similar to the Fed-encouraged sale of Bear Stearns.

The Nasdaq and S&P 500 racked up their sixth weekly decline, while the Dow recorded its fourth straight slide.

The Dow Jones industrial average closed down 128.48 points, or 1.14%, at 11,100.54. The Standard & Poor's 500 Index was down 13.90 points, or 1.11%, at 1,239.49. The Nasdaq Composite Index was down 18.77 points, or 0.83%, at 2,239.08.

Fannie shares opened on Friday down as much as 49% and Freddie dropped as much as 51%. A government takeover of one or both companies was among several options.

Fannie and Freddie rallied from their lows today after Treasury Secretary Henry Paulson said the government backs the lenders "in their current form," signaling the administration's intent to keep them as shareholder-owned companies, rather than placing them under government control.

Fannie fell 22% to $10.25 at the close of trading and Freddie lost 3.1% to $7.75.

Also pressuring stocks was another rise in the price of oil US crude for August delivery rose $3.43, or 2.4%, to settle at $145.08 a barrel on the New York Mercantile Exchange, after earlier hitting a record of $147.27.

The US dollar, which fell within 1¢ of its record low vs the euro, was down 0.9% to $1.5933 per euro at 4:28pm in New York on Friday, from $1.5788 on Thursday.

The euro increased 0.2% to 169.30 yen, from 169.05, after touching the all-time high of 169.63. The U.S. currency dropped 0.8% to 106.24 yen, from 107.07. The Australian dollar rose as much as 1% to US97.18¢, the strongest level since 1983.

The US currency posted a 1.5% weekly decline against the euro, the third drop in four weeks. The dollar decreased 0.8% versus the yen, which declined 0.9% against the euro.

The two-year US Treasury note's yield rose 19 basis points, or 0.19% point, to 2.59% at 4:40pm on Friday in New York, according to BGCantor Market Data. The price of the 2.875% security due June 2010 fell 11/32, or $3.44 per $1,000 face amount, to 100 17/32. The 10-year note's yield increased 16 basis points, the most since March 24, to 3.96%.

Aluminium for three-month delivery on the London Metal Exchange ended at $3,318 a metric ton from $3,290 at the close on Thursday, when it hit an all-time high of $3,380 a ton.

Copper last traded on Friday at $8,270 a ton from $8,230 at the close on Thursday. Copper for September delivery was trading up 1.30¢ at $3.73 by 16:05 GMT on the New York Mercantile Exchange's COMEX division.

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
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:

SML - Synlait Milk Limited - Trading Halt of Securities
AIA - Auckland Airport announces board chair changes
AIA - Auckland Airport announces board chair changes
CEN - Tauhara commissioning progress update
FPH initiates voluntary limited recall
March 28th Morning Report
KFL Celebrates 20 Years of Excellence in Investment Mgmt.
SVR - Savor FY24 Earnings Guidance & Change in Banking Partner
NZK - NZ King Salmon Investments Limited FY24 Results
March 27th Morning Report