Sponsored by: Investment Center

Something new in your business?  Click here to submit your business press release

Chamber Corner | Main Street News | Job Hunt | Classifieds | Calendar | Illinois Lottery 

Stocks point higher on Wells Fargo, Wachovia deal

Send a link to a friend

[October 03, 2008]  NEW YORK (AP) -- Stocks headed for a higher open while credit markets remained strained Friday after Wells Fargo Co. agreed to buy Wachovia Corp. in a $15.1 billion deal and ahead of an expected House vote on the government's $700 billion financial rescue plan.

CivicThe banks' plan cheered investors because unlike several recent banking deals it hasn't been put together at the behest of regulators or using government money. The agreement upends a plan announced Monday by Citigroup Inc. to acquire Wachovia's banking operations for $2.16 billion, a deal orchestrated by regulators.

The deal comes as investors remain eager for some resolution on the government's plan to buy up the bad mortgage-related debt blamed for clogging the world's credit markets. Trading has been volatile throughout the week based on investors' reading of whether the plan would win approval; on Monday, the House's rejection took Wall Street and Capitol Hill by surprise.

The Senate subsequently passed a sweetened version of the plan that added tax breaks and raised the limit on federal deposit insurance from $100,000 to $250,000. The revote is expected to occur again during market hours, which could make for somewhat restrained trading before that.

Water

On a busy Friday investors also will be looking to a key government reading on employment for clues about the well being of the economy.

The Labor Department is expected to report at 8:30 a.m. EDT that employers reduced jobs for the ninth straight month. Wall Street expects job losses for September will total 100,000, according to economists polled by Thomson/IFR. This year, the economy has shed 605,000 jobs. The unemployment rate is expected to remain flat at 6.1 percent.

Investors are eager for unemployment to remain in check because widespread job losses could damp consumer spending, which accounts for more than two-thirds of the nation's economic activity.

The credit markets indicated increased demand for safety early Friday. The yield on the 3-month Treasury bill, the safest type of investment, fell to 0.57 percent from 0.70 percent late Thursday. Yields have remained low in recent weeks as investors have worried about the health of the credit markets. Demand is high because investors are eager to safeguard their money.

[to top of second column]

Investments

The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.58 percent from 3.64 percent late Thursday.

Dow futures rose 54, or 0.51 percent, to 10,611. Standard & Poor's 500 index futures rose 8.90, or 0.79 percent, to 1,133.30, and Nasdaq 100 index futures rose 10.50, or 0.70 percent, to 1,521.00.

The dollar was mixed against other major currencies, while gold prices fell.

Overseas, Japan's Nikkei stock average fell 1.94 percent. In afternoon trading, Britain's FTSE 100 rose 0.09 percent, Germany's DAX index rose 0.69 percent, and France's CAC-40 rose 0.13 percent.

___

On the Net:

New York Stock Exchange: http://www.nyse.com/

Nasdaq Stock Market: http://www.nasdaq.com/

[Associated Press; By TIM PARADIS]

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Investments

< Recent articles

Back to top


 

News | Sports | Business | Rural Review | Teaching & Learning | Home and Family | Tourism | Obituaries

Community | Perspectives | Law & Courts | Leisure Time | Spiritual Life | Health & Fitness | Teen Scene
Calendar | Letters to the Editor