Lynn Thomasson and Adam Haigh report for Bloomberg.com in "U.S. Markets Wrap: S&P 500 Caps Biggest 10-Day Gain Since 1938," that major stock indexes in the U.S. rose dramatically on news of the Treasury plan to buy up to $1 trillion of distressed assets, increasing oil prices, and 5.1% increase in existing home sales. The two week rally was the biggest since 1938 for the S&P 500.
The S&P 500 gained 7.1 percent to 822.92, its biggest increase since Oct. 28. The Dow Jones Industrial Average jumped 497.48 points, or 6.8 percent, to a five-week high of 7,775.86. The MSCI World Index climbed for the ninth time in 10 days, adding 5.4 percent. Twenty-one stocks rose for each that fell on the New York Stock Exchange, the broadest rally since at least July 2004.
Financial institutions were big winners. I hope the increase in value is due to investor confidence that the Treasury plan will loosen "frozen" markets and not just recognition that the Treasury will buy a big chunk of their bad decisions.
Bank of America Corp. and Citigroup Inc. both soared at least 19 percent as the U.S. Treasury said it will finance as much as $1 trillion in purchases of distressed assets.
Oil stocks increased on continued strength in oil prices.
Crude oil for May delivery rose $1.73 to $53.80 a barrel at 2:43 p.m. on the New York Mercantile Exchange, the highest settlement since Nov. 28. Prices are up 21 percent this year...Exxon Mobil Corp. and Chevron Corp. jumped more than 6.7 percent after oil rose to an almost four-month high.
Ylan Mui and Renae Merle report for the Washington Post in "Treasury's Bank Plan Sparks a Broad Rally," that stock related to the housing market also did well.
...home builders benefited from the broad-based stock market rally yesterday. Toll Brothers jumped 11 percent, to close at $18.84. D.R. Horton spiked 18 percent, to $9.89, while Pulte Homes rose 13 percent, to $11.08.
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1 year ago
I am an optimist, and I am hoping that this is a result of Fmr. President Bush's, and President Obama's bailout packages.
ReplyDeleteHopefully something good could come out of these packages, besides a higher national debt, and more stress for the everyday people
I think that the bailout packages will do some sort of strengthening in this economy to an extent. However, we can't just keep relying on these packages. We need to develop new ways to further this economy so that we don't come any closer than we are to a depression.
ReplyDelete-Hunter Hezmall (microeconomics)
hh0300006@students.mclennan.edu
It is good to finally see the stock market have a good week. Hopefully, we will continue to move forward from here. Our economy will thrive again soon, maybe next month, or next year. The lengths the government has gone through to try and get the economy where they want it will have its affect in the upcoming months and years. I think that a big part of the stocks going back up is the people's belief that a change for that good has been made, even though the affects of those changes haven't come into full play just yet.
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