25/9/08

FTSE 100	5095.57, -40.55	Dow	10825.17, -29
FTSE 250	8407.36, -47.22	Nasdaq	2155.68, +2.35
FTSE All Share	2591.71, -19.43	S&P 500	1185.87, -2.35
Nikkei	12006.53, -108.5	Hang Seng	19073.02, +111.03
Oil (Crude)	$105.73	Gold	$895
Base Rate	5%	10 Yr Gilt	4.599%
£/$	1.862	Euro/Gbp	0.791

Markets
US markets finished mixed yesterday in a choppy session as uncertainty about the $700 billion bank bailout offset Warren Buffett's $5 billion bet on Goldman Sachs. Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke continued to urge Congress' Joint Economic Committee to pass the bailout in a bid to protect taxpayers. But lawmakers remained sceptical voicing concerns about the size and scope of the plan.

The Dow Jones slipped 29 points to close at 10,825.17, the S&P 500 lost 2.35 points to end at 1,185.87. The Nasdaq edged 2.35 points higher to 2,155.68.

Warren Buffett's decision to invest into Goldman Sachs did ease some concerns about the bailout. Shares in Goldman's jumped 6.4%, while the Class A stock of Berkshire Hathaway, Buffett's holding company, rose 3.5% to $133,300.

Not all financial stocks benefited though, Citigroup was the top drag on the Dow, dropping 5.2%. While in the broader market, shares of economic bellwether General Electric fell 1.4%.

Tech stocks were one of the stronger performing sectors of the day. Oracle Corp climbed 1.3%, Apple Inc rose 1.5% and Microsoft gained 1.1%. Investors see the technology sector being one of the main beneficiaries of the bailout plan, as it would lead to an increase of spending.

US light crude oil for November delivery slipped $0.88 to settle at $105.73 a barrel. COMEX gold for December delivery rose $3.80 to $895 an ounce. Treasury prices were mixed, leaving the yield on the 10 year note at 3.75%

The Nikkei finished 108.5 points lower at 12,006.53 this morning. Nissan Motor Co declined 5%, leading automakers lower after data showed US bound car exports plunged as the financial crisis spilled into consumer spending. Re-plus re-ignited credit concerns after becoming the latest Japanese property company to go bankrupt.

The Hang Seng is currently 111.03 points higher at 19,073.02. Morgan Stanley boosted the market after their analysts recommended Chinese banks for their "favourable macro backdrop". Elsewhere, China Oilfield Services Ltd advanced 3.4% on speculation its parent may increase its stake in the company after China eased regulations on share buybacks.

The FTSE 100 is just 2.05 points lower at 5,093.52 this morning. Thomas Cook leads the fallers, down 6% on reports that Arcandor AG may reduce its level in the company in a bid to raise cash. Lloyds TSB is 2.7% lower after Deutsche Bank cut its rating on the stock to "sell" from "hold" and its price target to 200p from 250p.

Economics
US Initial jobless claims (week 20 September 2008) 13.30 bst

Last weeks initial claims rose to 455,000, up from 445,000. Louisiana reported a backlog of claims from previous weeks as government offices had lost power during Hurricane Gustav. Claims are expected to be 440,000 this week. Continuing claims for the previous week could rise to 3.52m, up from 3.48m.

US Durable goods orders (Aug) 13.30 bst

After two strong months in June and July, durable goods orders are seen falling 2 percent in August, with ex-transportation orders falling 1.3 percent. Boeing aircraft orders fell from 70 to 38 and should explain part of the decline, but other categories such as machinery and fabricated metals may also drop. The ISM new orders index was unimpressive at 48.3 in August and has been close to or below breakeven since the beginning of the year.

US New home sales (Aug) 15.00 bst

New home sales have declined by 63 percent from their late 2005 peak. While pending and existing home sales have shown some signs of improvement since late last year (particularly in the West), new home sales are only barely up from their low after rising 2.4 percent in July. A modest further improvement in August is expected, with a 3 percent increase up to 530,000.

US Bernanke and Paulson testimony 17.00 bst

Bernanke and Treasury Secretary Henry Paulson testify before the House Financial Services Committee on the government's takeover of Fannie Mae and Freddie Mac.

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