When you have a trading day like today and it comes after a week like this week, it is hard to determine if you are happier that the rally came on at the end of the day or if you are happier that the closing bell came to end the week. The markets closed down today but today felt like a win when you consider the 400 point move higher off of late day lows in the last hour. There are hopes of a coordinated G7 announcement this week along with some fresh hopes that the Treasury will make new banking injections and help in the LIBOR woes. The bond traders left at 2:00 PM early for Columbus Day, and the bond market is closed Monday.
Here are the unofficial closing bell levels, and remember that the exchange takes much longer to find actual close levels right now: DJIA 8,477.40 -101.79 -1.19% NASDAQ 1,649.51 +4.39 +0.27% S&P500 901.24 -8.68 -0.95% 10YR T-NOTE 3.861% +0.027% Top Analyst Upgrades
Barclays plc (NYSE: BCS) fell on reports that the financial bank giant is considering raising capital as part of the government's bailout package in the UK. Shares were down 9% at $14.66 in the final minutes before the close.
I am the Global Editor at MoneyShow.com and each week I interview an investing expert. This week, I spoke with John Snowden, contributor to The IRS Report newsletter, who says the British economy will slide deeper into recession and the markets will move lower, too.
Q. What is your outlook for Great Britain's economy in the next 12 months?
A. We are on the cusp of a recession, but we have yet to feel the real crunch from a retailing viewpoint. The forthcoming all-important Christmas trading period will give more of a guideline by [the middle or end of] January. There is as yet no real sign of confidence returning, which would suggest we are in for a long haul. Borrowings are at an all-time high and will probably double again next year. This may mean higher taxes as well as labor unrest which would be detrimental for the economy.
Lower oil prices do help and commodity prices are falling, and will start to be reflected in government statistics by early next year. Hence, economy fears are turning towards deflation rather than inflation
Q: So, at what point do you expect to see actual recession in the UK?
A: My guess is that Christmas festivities may distort the reality, but I am sure that by February 2009, we in the UK will be feeling the full weight of recession.
The federal government is considering backing all bank deposits and guaranteeing huge amount of bank dept. Depositors are withdrawing money from financial companies at an alarming rate.
According toThe Wall Street Journal, "If the two moves come to fruition they would mark the government's most extensive intervention yet in the financial system."
"If" is a big problem. Many banks and brokerage stocks are selling off at the rate of 10% to 20% a day. Barclays (NYSE: BCS) opened down over 20% in London trading.
Governments are allowing the collapse of financial markets to get well out ahead of solutions. If that continues, confidence in the banking system could falter further and lending could be shut down completely.
If the Treasury and Fed do not act over the weekend, next week could be unspeakably tough.
Douglas A. McIntyre is an editor at 247wallst.com.
Much as I find it hard to muster sympathy for thousands of overpaid investment bankers forced to walk to the unemployment office in their designer shoes, the news that Lehman Brothers Holdings Inc. (NYSE: LEMQ) won't be paying them severance made me feel a little sorry for them.
According to Bloomberg News, the New York-based firm recently notified employees that they will not receive a payment on October 3 or after. The company reneged on a promise to the fired workers to pay them severance until August 2009. Workers who want the rest of their compensation will have to file a claim with the bankruptcy court. It will take years for the former employees to get paid through Chapter 11 and even then they might only get a fraction of what they are owed.
Bloomberg reports that it is not clear how many former Lehman employees have been affected. You can bet that members of Congress and the Department of Justice will be interested to know if Chief Executive Richard Fuld will receive a golden parachute once Barclay's PLC (NYSE: BCS) completes its takeover of the once-storied New York investment bank.
This post is part of a series in which TheStockAdvisors.com asked financial experts to name their top stock pick if McCain or if Obama wins the election.
"McCain, a friend of Wall Street, would encourage investing through tax breaks, which ultimately means more profits for Barclays (NYSE: BCS), the British bank that has acquired Lehman Brothers' U.S. investment banking assets," notes Vivian Lewis in her Global Investing.
"Barclays is now investing hugely in the business of U.S. investing, having picked up the investment banking and asset management businesses of Lehman.
"Barclays got a bargain, cherry picking the bits of Lehman worth the most, including the HQ building in NY. It was required by British regulators to immediately issue a program for financing the acquisition to reassure markets worried about capital sufficiency.
"The new assets will beef up Barclays' U.S. presence (and its U.S. risk). The British bank already is a major player in the issuance of Exchange Traded Funds, a cheap and popular 21st century investment mode.
"Adding Lehman to the pot will further boost its prowess in this special part of fund management. Then too, the international connection will probably result in new business in managing money for other investors like high-net worth individuals.
This post is part of a series in which TheStockAdvisors.com asked financial experts to name their top stock pick if McCain or if Obama wins the election.
Which stocks would benefit from a victory by either Senator John McCain or Senator Barack Obama? To help investors sort through the sectors and stocks best positioned to benefit in a post-election environment, we posed this question to some of the nation's leading financial newsletter advisors.
Importantly, this is not a partisan report; each participating advisor has provided a favorite stock for both candidates, focused not on political preferences but unbiased stock analysis. Below we feature those stocks and ETFs that the advisors believe will be the winners depending on which candidate prevails.
If not for the collapse of Washington Mutual (NYSE: WM) this week, I would probably not have posted this saga so soon after last Monday's report. However, since I was a shareholder of WaMu and thought there was value in it when I posted Chasing Value: Are you watching WaMu? I felt it was time to take my lumps.
I cannot go on ranting and raving about the failures and deceptions of others without making sure that I am forthright and transparent myself. I did post Chasing Value: Not -- WaMu one week later - ouch! but now WaMu is toast and so is some of my money.
Since I posted Serious Money: Tempting fate with 10 financials, the results of buying into the following pool of financial stocks at a time when the "hate 'em" factor was at a peak, with each passing day investors have found something more to hate.
The portfolio is losing 4.8% to date, not counting dividends. Some of my colleagues thought it was way too early to get back into the financial sector; seems that way now, and one read me the riot act for reporting the story so soon on MBIA Inc. (NYSE: MBI) being up substantially.
Wild Markets: What You Should Be Watching Now Big financial companies appear to be falling like dominoes as the credit crisis intensifies. Individual investors worried by all the turmoil may wonder what they should be watching as Wall Street quakes. BusinessWeek offers five signals in the equity and credit markets that investors should keep an eye on to gauge whether the clanging chimes of doom are tolling louder for individual financial firms. Markets: What You Should Be Watching Now - BusinessWeek Money Market Fund Says Customers Could Lose Money Primary Fund, one of the first and largest money-market funds, puts seven-day freeze on redemptions after Lehman bankruptcy sends net asset value below $1 a share. The announcement by the Primary Fund marks only the second time in history that a money market fund has "broken the buck" - reporting a per-share value below a dollar. Money Market Fund Falls Below Sacred $1 Mark Also: Cloud Over Money Market Funds Frays Investors Trust More
U.S. stock futures edged lower Wednesday morning after the government announced late Tuesday it would help save AIG. Investors may be relieved with the action on AIG and even the Federal Reserve decision not to move Tuesday, leaving room for a future rate cut, there are still big concerns about the state of financial markets. Investors today will also get data from on building permits and housing starts for the month of August. Oil rebounded today ahead of inventory report to over $93 a barrel.
The Federal Reserve said late Tuesday that it would to lend $85 billionAmerican International Group (NYSE: AIG), taking a 79.9% stake in the company. AIG shares are still sinking 30% in pre-market trading.
Meanwhile, as the government refused to help Lehman Brothers (NYSE:LEH) and the company filed for Chapter 11 Monday, Barclays PLC (NYSE: BCS) said it would buy Lehman's banking and capital markets business for $250 million. Barclays walked away from the deal a few days ago, perhaps waiting for a better price, in what many say BAC should have done with Merrill. BCS shares are up over 5% in pre-market trading, LEH's down over 25%.
Morgan Stanley (NYSE: MS) reported its quarterly earnings early to calm investors, posting better-than expected results. It seems the last two major independent investment houses, Morgan and Goldman Sachs (NYSE: GS), which also reported earning Tuesday, both posted third-quarter profits despite continued chaos in the financial markets.
J.P. Morgan Chase (NYSE: JPM) is reportedly in advanced talks to make a bid for Washington Mutual (NYSE: WM).
Bulletproof Your Portfolio How to protect your portfolio from the tsunami enveloping Wall Street. Investment experts from around the world weigh in with thier outlook for the stock, currency and commodities markets and the financial sector and tips for what investors can do during the turmoil and what Wall Street may well look like down the road. What the Pros Say: - CNBC.com
U.S. stock futures were lower this morning, indicating stocks could start the day with losses, a day after the worst session in years. While Goldman Sachs is set to release results, many eyes will focus on the Federal Reserve as it meets Tuesday. The market is betting on a rate cut soon, although perhaps not this meeting. Meanwhile, the Labor Department will release August Consumer Price Index. As global stock markets followed Wall Street's lead with losses of their own, oil prices took another dip to about $92 a barrel.
Goldman Sachs (NYSE: GS), one of the few independent brokers left after Lehman's demise and one that is now mentioned as a possible "next" will release its fiscal third-quarter earnings before the bell. Goldman's troubles have not been as deep as other financial companies, but no one expects Goldman to have stellar earnings.
And as expected, American International Group Inc. (NYSE: AIG) was hit by a wave of downgrades by credit-rating agencies. The new ratings are all still considered investment grade,but this only adds to the pressure on AIG as it seeks billions of dollars to strengthen its balance sheet. AIG stocks is sinking another 42% in pre-market trading.
Standard & Poor's also downgraded Washington Mutual (NYSE: WM)'s credit rating to junk status, citing the deteriorating housing market. WaMu shares are slipping yet another 15% in pre-market trading.
Staying with financials problems, General Electric Co. (NYSE: GE) shares hit a five and half year low on concern over its financial arm.
Many overseas stock markets were down 5%. The Nikkei fell 5% to 11,610. Shares in some large financial companies were down over 10%. The Hang Seng fell 5.4% to 18,305. The Shanghai Composite was off 4.5%.
In Europe, most markets were down almost 2% early in their sessions. Barclays (NYSE:BCS) opened down almost 5%.
Sun (NASDAQ:JAVA) is up over 10% on better-then-expected earnings.
Freddie Mac (NYSE:FRE) and Fannie Mae (NYSE:FNM) both up about 7%, perhaps on news that they may save cash by cutting dividends.
RBS (NYSE:RBS) is down 10% on concerns about mortgage-based holdings are Europe banks. Barclays (NYSE:BCS) is off over 5%, probably for the same reason.
Stocks may trade differently in the pre-market than they do in the regular session.
I am the Global Editor at 
Much as I find it hard to muster sympathy for thousands of overpaid investment bankers forced to walk to the unemployment office in their designer shoes, the news that 
If not for the collapse of 
U.S. stock futures edged lower Wednesday morning after the government announced late Tuesday it would help save AIG. Investors may be relieved with the action on AIG and even the Federal Reserve decision 
Is the market always right?
Comfort Zone Investing: How this all might play out
Stock picks and pans for troubled times: AAPL, COST, EWBC, IBM, YUM, PG ...
