Big Banks See Things Looking Up
After a four-day downturn, world stock markets had a change of spirit on Tuesday, when leading American indexes grew by 2.5-3.5 percent, with the Dow Jones topping 13,000 points. That was the second notable jump since the Federal Reserve Board decided to lower the discount rate by 50 base points in September. The following day, Asian and European markets hiked up by 1-5 percent. The RTS index rose almost 1 percent to 2244.11 points.
Market watcher say that the Russian market is no longer tied to the American market, but rather to oil prices, and a fall in those price dampened enthusiasm on the Russian market. Analysts say that, in general, investors' optimism is connected to new corporate reports and they predict that the market be stable through the end of the year.
Stock in Goldman Sachs was up 8.5 percent and in JP Morgan 6.3 percent on Tuesday following upbeat statements by those banks' leaders. Bank of America and Citigroup were also up, despite BofA's announced writedown of $3 billion and restructuring of Citigroup's investment division.
Market growth practically stopped yesterday, however. At 8:15 p.m., American indexes even fell by 0.1-0.3 percent. Analysts say that the American mortgage crisis and its effects have not passed yet. The future direction of the American economy is still in question. Bad news may still be heard in the second quarter of next year, when a wave of subprime mortgage payments will come due.
www.kommersant.com
All the Article in Russian as of Nov. 15, 2007
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