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It might be a hopeful week in a bear market
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U.S. stock index futures edged higher on Monday after Wall Street's sharp drop on Friday as investors speculated that the Federal Reserve may cut interest rates in an emergency move to shore up the economy.
Asian equities were lower on heightened fears of a U.S. recession, after U.S. data on Friday showed the biggest U.S. job losses in five years. But European stocks turned higher by midmorning, as strength in oil stocks and talk of M&A activity helped cushion recession worries.
Analysts said there was talk in the market that the Federal Reserve may cut interest rates in an emergency move before its scheduled meeting next week.There's some rumbles going around the market that the Fed may do an emergency cut. Futures are also taking their cue from Europe. They started rebounding a little bit. We have a lot to digest.
Dow Jones industrial average futures rose 16 points, and Nasdaq 100 futures rose 4.25 points.Monday's data calendar is fairly sparse, with January wholesale inventories due at 10 a.m. (1400 GMT).Bond insurers will again be in the spotlight, after New York State Insurance Commissioner Eric Dinallo said on CNBC that bond insurer FGIC is a "problem" that is being addressed this week and that he expects the company to survive in "some
On Friday, the Dow Jones industrial average .DJI slid 146.70 points, or 1.22 percent, to end at 11,893.69. The Standard & Poor's 500 Index .SPX fell 10.97 points, or 0.84 percent, to 1,293.37 -- its lowest close since August 2006.
The Nasdaq Composite Index .IXIC dropped 8.01 points, or 0.36 percent, to close at 2,212.49.
FANNIE MAE, GOOGLE IN FOCUS
Stocks in focus on Monday could include Fannie Mae the largest U.S. home funding company after a report in the latest issue of Barron's suggested the company may need a government bailout.
Shares of the government-sponsored enterprise have fallen 65 percent since last autumn, amid a worsening U.S. housing crisis sparked by defaults on risky subprime mortgages.
Barron's said the company, which lost $2.6 billion last year, has a balance sheet that appears loaded with "iffy" assets and understated liabilities that could leave the company ill-equipped to weather a serious financial crisis.
Shares in Fannie Mae rose by nearly 5 percent on the New York Stock Exchange on Friday and by 0946 GMT on Monday were up 2.3 percent from their last close in Frankfurt at 14.40 eurosBarron's also said Internet search company Google may see another 20 percent fall in its share price as the U.S. economy slows. Google shares were down by 1 percent from their Friday close in Europe at 279 euros in Frankfurt.
I expect American dollar to continue to weaken against major currencies.In every 5-10 years American market needs a correction in order to avoid crisis like 1987 or 1929( very different types)and we are in the correction of housing bubble.If it was'nt a a general correction ,defensive stocks should have been stayed defensive.In short,I expect the turmoil to continue 3-4 months then a stabilazation in financial markets.
Even in Japan,subprime-related losses at global financial institutions have so far totaled as much as $215 billion, with about 55 percent of that coming from the United States, the head of Japan's financial regulator said on Monday.
The estimates from Japan's Financial Services Agency (FSA) come after JPMorgan Chase & Co said in a report late on Friday Wall Street banks are facing a "systemic margin call" that could deplete them of up to $325 billion in capital.
European losses totaled about 8 trillion yen ($78.5 billion), while Asia and Canada together accounted for about 1.4 trillion, FSA Chairman Takafumi Sato told reporters at a regular briefing.
Japan's financial institutions have so far avoided the massive subprime losses taken by overseas rivals, but they have not escaped unscathed.
Subprime losses at Japanese banks more than doubled to 600 billion yen in the last quarter of last year, with total exposure to subprime investments hitting 1.5 trillion yen, the FSA said last month."Compared to overseas, Japan's subprime-related losses and exposure are relatively limited," Sato said.As you mighr remember Bernanake told that the exposure might have been around 100 billion dollars in past August.I guess he missed a 0. |
| Tarih
: 10.03.2008 |
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© 2006 Mert TOKER All Rights Reserved. |
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