Governments have introduced new measures to support global financial system, the Dow hit on Monday, its biggest one-day point gain ever, reversing the decline after crashing.
The Dow rose 936.42 points Monday, closing at 9387.61 points, or 11.1%,glue stick for 8 days after the end of the trend of decline, during which the Dow fell nearly 2,400 points, 112-year history of the index of the worst single week performance.
Dow 30 stocks, 29 rose only, only General Electric (GeneralElectric) fell 2.3%. Reported working with Chrysler (Chrysler) to negotiate the merger of General Motors (GeneralMotors) led the broader market, rose 33.1%.glue gun Aluminum Company of America (Alcoa) and Chevron Corporation (Chevron) both rose more than 20%, Microsoft (Microsoft) rose 18.6%, American Express Company (AmericanExpress) rose 17.9%.
Regulators have been trying to shore up financial institutions to ease frozen credit markets led to panic. Many analysts hope that the recent measures to enable some of the worst crisis in the past, but some people warned that the weak economy and credit crunch behavior may still continue. Despite sharply higher Monday, the Dow is still down over 29% year over October 9, 2007 closing price of 14,164.53 hit the highest point down by 34%.
Trader Brett (DonBright), I have to admit, they did take some reasonable measures. Washington, he had questioned the initial rescue the U.S. financial sector initiatives. As far as policy makers in the increasingly global initiatives taken, he said, we must do; no friends joint action in the circumstances, we believe that no matter how strong the U.S. economy, we can not do this thing .
As credit markets freeze, and worried that more companies because of the lack of financing which may be pushed into insolvency situation, investors have fled last week, the risk; global authorities on Monday promised to take further joint action to troubled banks injection system, investors welcomed.
Eurozone leaders of 15 countries agreed to provide guarantees for loans between banks through 2009 and allow member governments to buy beleaguered shares of financial companies. Australia guaranteed wholesale funding for banks. Britain said it would provide up to 3 banks inject 63 billion U.S. dollars. Germany also announced a 1,070 billion capital injection program. European Central Bank (ECB), Bank of England (BOE) and the Swiss National Bank (SwissNationalBank) announced that it would provide unlimited funds for banks.
Some data show that financial market tensions eased. According to the British Bankers Association (BritishBankers'Association) data, 3-month U.S. dollar London Interbank Offered Rate (Libor) from 4.81875 percent on Friday fell to 4.7525 percent. At the same time, 1-month rate fell to 4.56% from 4.5875%. Columbus Day on Monday at the United States (ColumbusDay) closed, there is no overnight call rate pricing.
TullettPrebon of the Group of Seven (G7) LenaKomileva head of market economics, said, ice began to melt.
Recent policy initiatives that have global stock markets rebounded. Major European stock indexes rose. Asian stock indexes rose, Hong Kong's benchmark index rose 10.2%. The major indexes rose for the New York Stock Exchange before the opening of U.S. markets set a positive tone.
Standard & Poor's 500 index rose 12% to 1003.35 points. All sub-index rose across the board, energy stocks led the gains, or up 18.1%. There are five daily Standard & Poor's index rose more than 10%, financial stocks rose 6.4%. The Nasdaq composite index rose 12%, to close at 1844.25 points. The Russell 2000 index of small stocks rose 9.2% to 570.55 points.
Despite Monday's sharp rally there, but many Wall Street veterans still believe that the global economy and stock market in the coming months will experience a downturn.
Connecticut MKMPartners trading and research institutions, chief economist Michael ? Dalda (MichaelDarda) said that now the danger is that we will call back after the short-term oversold as a strong rebound in the wrong has been kicked off.
Dalda Monday research note to clients, warned that high-yield corporate bonds from the U.S. Treasury spreads between the changes, the U.S. economy in the next two years or so still in a slump, the highest unemployment rate may reach 8%, while the latest unemployment rate in September was 6.1%.
Dalda said that in many ways, I'm not sure our economy is the unemployment rate of 8% ready. Many families have a large number of mortgage loans and credit card debt. They only like the companies that raise cash by selling assets.
Chicago franchisees BrightTrading partner Brett Darfur in Fort Lauderdale to attend a trade seminar. He returned to the hotel room using his laptop to trade, sell when the market rebounded, and then a brief pullback in the market to buy back. This operating strategy reflects his view that although the market will continue to oscillate in a single day, and significant opportunities for the sharp rise, but as long as several weeks or months more sustained rise in conditions are not yet mature.
With the trading hours of the last remaining hours, Albright noted that the callback rate of the S & P 500 index smaller and smaller, each callback from the original point reduced to 2,3 6,7 points. He said that in this case, we can no longer be a true two-way deal. I decided to leave open, because the situation seems to be out of control.
Market is indeed out of control, the S & P and the Dow Jones index in the last hour both up nearly 4%. But Blatter said Monday he does not regret missing the last hour of thrilling opportunity.
He said that we always take profit that the practice of withdrawal, in particular, such a trend in the market at any time are likely to get you into the abyss of time.
Because the U.S. bond market closed on Columbus Day Monday, some traders believe the stock market and how many problems can not explain. One trader said that in recent weeks we have real concern is the credit problem, we do not see often on Monday from the credit market should see all signals.
Noteworthy stocks in Morgan Stanley (MorganStanley) completed a $ 9,000,000,000 to the Mitsubishi UFJ Financial Group (MitsubishiUFJFinancialGroup) 21% stake in the sale, the shares have announced the deal than the last trading day before . Closing down 61%. Morgan Stanley's shares rose about 87% of the message. Mitsubishi UFJ rose by 15.5%.
New York Mercantile Exchange crude oil futures rose $ 3.49 to $ 81.19 a barrel, or 4.5%, mainly boosted by the increase in speculative activity, traders find loans easier, for crude oil only as a financial instrument transactions anxiety has eased. But the long-term demand outlook remains bleak. Strong rebound in other commodities. Dow Jones-AIG Commodity Index rose 2.7%.
U.S. dollar mixed against major currencies. 1 euro against 1.3583 U.S. dollars, higher than the $ 1.3413 late Friday. 1 U.S. dollar against 101.78 yen, higher than Friday's 100.25 yen.