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UK May Follow U.S. in Rate Cut
Jan 22, 6:12 PM EST |
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| Banks and retailers rebounded from the lows of the day, after the rate cut in the U.S. Talks of rate cut in the UK intensified. |
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| Pound recovered against dollar to $1.958 from $1.955 after the Federal Reserve cut the rates in the U.S. by 0.75% to 3.5%. Stocks in London dropped in the morning trading, for the second day, after Asian markets declined. FTSE 100 dropped at the worst of the day nearly 2%. In the afternoon trading stocks recovered after the rate cut in the U.S. and hopes that the U.S. may avoid recession. Schroders and Wolseley led the gainers in the FTSE index and Imperial Tobacco led the decliners. |
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Europe Rebounds, Germany Lags
Jan 22, 5:42 PM EST |
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| Sweden led the European markets with a rise of 4% followed by increases of 3% in Switzerland and UK, 2% in France, and 1.3% in Italy and Spain. |
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| European markets were all set to lose more than 4% for the second day in a row after similar declines in Asia. Market averages managed to rebound from the low and closed up 2% or more. The Bank of England and ECB may have to lower rates in the next meetings. German market rebounded from its worst decline in five years. Deutsche Bank, commerzbank, and Fraport led the recovery. Heidelberger Druckmaschinen rebounded 12% after the stock yielded 12%. Banks and uitilities led the recovery in France. |
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Emergency Rate Cut, U.S. Stocks Decline
Jan 22, 5:28 PM EST |
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| Emergency interest rate cut of 0.75% smoothed market recovery from the opening losses but investors appeared in the selling mood. |
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| The preemptive move by the Fed to lower interest rate by 0.75% was welcomed by investors. Market recovered from the morning loss of 4.5% in Dow, S&P 500, and Nasdaq. Three averages closed between 1% and 2% lower. Investors are now looking for additional rate cut. Retailers and bond insurance companies rallied but base metals and energy companies declined. European markets rebounded 2% and South American markets jumped 4% or more. |
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Sensex Declined 20% From Peak
Jan 22, 4:36 PM EST |
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| Indian stocks fell for the second day in a row on margin calls, lack of buyers, and worries related to the U.S. slowdown. |
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| Margin callls, global worries, and lack of retail buyers, all came together for the second day in a row. Sensex dropped 5% or 875 to 16,729. During the day it had dropped as low as 15,332. Finance Minister Chidambaram urged investors to be calm. Sensex and CNX Nifty are down 20% from the peak and midcap and small cap indexes on BSE are down 30%. Reliance industries, ONGC, HDFC Bank, ICICI Bank, and ITC led the decliners list in the large cap sector. Bhrti Airtel rebouded 3%. |
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U.S. Stocks Retrace 4% Opening Losses
Jan 22, 4:43 PM EST |
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| U.S. market averages recovered from the sharpl loss on the global markets plunge. Emergeny rate cut helped markets to recover. |
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| U.S. stocks rebounded from a sharp loss at the opening. After the Fed cut rates in emergency session by 0.75% and on the back of gloabl decline, U.S. stocks opened 4% lower. After ninety minutes of trading, stocks retraced most of their losses. Bank of America fell after it reported CDO related $5.2 billion. |
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Fed Cuts Rates by 0.75%, Asian Markets Plunge
Jan 22, 10:01 AM EST |
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| In a preemptive move to contain the economic growth from sliding into a recession, the Fed lowered a interest rate by 0.75%. |
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| The Federal Reserve Bank lowered interest rate by 0.75% to 3.5% to thwart the economy from sliding into a recession. The Fed cited weakening economy and increasing downside risk to growth. The Fed lowered rate ahead of its two-day meeting schedule at the end of this month shows the gravity of the situation. Globla markets in the last two days have lost between 10% and 15%. European markets rallied after the news but Asian markets closed down between 5% and 8% for the second day in a row. |
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