Talk of Ambac Rescue Lifts Stocks

123jump.com Staff
22 Feb, 2008
New York City

U.S. stocks reversed their earlier losses and managed to close higher on a rebound in the final thirty minutes. The news first reported on CNBC suggested that a group of eight banks are in the final stages of negotiaion to invest $3 billion in Ambac and help it to retain its AAA rating. Ambac surged 16%. U.S. dollar reached a nine-year low against Brazilian real and traded only 1 cent lower from its record low against euro at $1.4863.

[R]10:00PM Frankfurt, 4:00PM New York, 8:00AM Sydney – Talks of investment in Ambac Financial from a group of banks lifted stocks in the final hour of trading.[/R]

European Markets

In London FTSE 100 Index closed lower 43.70 or 0.74% to 5,888.50, in Paris CAC 40 Index decreased 34.30 or 0.71% to close at 4,824.55 and in Frankfurt DAX index lower 98.56 or 1.43% to close at 6,806.29. In Zurich trading SMI decreased 31.40 or 0.42% to close at 7,454.75.

North American Markets indexes

Dow Jones Industrial Average added 96.72 or 0.79% to a close of 12,381.02, S&P 500 closed up 10.58 or 0.79% to 1,353.11, and Nasdaq Composite Index traded up 3.57 or 0.16% to a close of 2,303.35. In Toronto TSX Composite closed higher 76.38 or 0.57% to close at 13,585.93.

Of the 30 stocks in Dow Jones Industrial Average, 25 closed higher, 5 closed lower, and none were unchanged.

AIG led the gainers in the index with a rise of 2.7% followed by increases in Verizon of 2.4%, in JP Morgan of 2%, in United Tech of 1.9%, and in AT&T of 1.5%. Intel led the decliners in the index with a loss of 2.4% followed by losses in Microsoft of 1.5%, in General Motors of 0.9% and in Merck of 0.1%.

Of the stocks in S&P 500, 392 closed higher, 106 fell, and two were unchanged. Of the index stocks, 4 rose more than 3% and 38 stocks fell more than 3%.

Intuit led the decliners in the index with a loss of 9.2% followed by losses in Sovereign Bancorp of 4.7%, in Freddie Mac of 4.11%, in Citrix Systems of 3.7%, and in Quest Diagnostic of 3.6%. Ambac Financial Group led the gainers in the index with a rise of 16% followed by increases in MGIC Investment of 9.8%, in first Horizon of 7.3%, and in Discover Financial of 6.6%.


South American Markets Indexes

In Latin Markets Brazil led the gainers in the region with a rise of 1.28% followed by increases in Mexico of 0.57%, and in Argentina of 0.24%. Peru led the decliners in the region with a loss of 0.74% followed by losses in Chile of 0.2%, and in Colombia and Venezuela of 0.1%.


Asian Markets

In Tokyo Nikkei 225 Index closed lower 187.82 or 1.37% to 13,500.46, in Hong Kong Hang Seng index decreased 317.96 or 1.35% closed to 23,305.04. Australia ASX 200 index decreased 23.50 or 0.42% to close 5,559.90.

In South Korea Kospi Index decreased 17.91 or 1.05% to close at 1,686.45, in Thailand SET index closed lower 0.27 or 0.03% to 826.86 and Indonesia JSE Index edged increased 6.97 or 0.25% to 2,741.18. Sensex index in India decreased 385.61 or 2.17% to 17,349.07.

Bond Yields increased on 10-year U.S. bonds to 3.81% and on 30-year bonds declined to 4.58%.

[R]Commodities, Metals, and Currencies[/R]

Crude oil increased $0.81 to close at $98.08 per barrel for a front month contract, natural gas increased 31 cents to $8.89 per mBtu, and gasoline futures increased 2.35 cents to close at 254.55 cents per gallon.

Gold decreased $0.70 in New York trading to close at $948.50 per ounce, silver closed up 10 cents to $18.052 per ounce, and copper for front month delivery decreased 0.9 cents to 381.30 per pound and in London copper futures increased $273.00 to $8,467.00.

Wheat futures rose 19.00 cents in Chicago trading and closed at $10.64 per bushel. Sugar decreased 18 cents to 14.24 cents per pound. Soybean future closed up 13.50 cents to $14.38 per bushel.

Dollar edged lower and traded near record lows against euro to $1.4834 and edged lower against yen to 107.18.