Stocks surge after U.S. Federal Reserve rate cut
Updated Fri. Aug. 17 2007 9:53 AM ET
CTV.ca News Staff
http://www.ctv.ca/servlet/ArticleNe.../stock_markets_070817/20070817?hub=TopStories
A dramatic move by the U.S. Federal Reserve to calm plunging financial markets worldwide sent North American stocks sharply higher on Friday morning.
In response to the economic uncertainty, the Fed approved a half-percentage point cut in its discount rate on loans to banks before trading began.
Toronto's S&P/TSX composite index jumped 343.03 points to 13,191/73 after a 200.06-point slide Thursday wiped out the TSX's gains for the year so far.
The Canadian dollar surged 1.46 cents to 94.46 cents US as the American dollar weakened.
On Wall Street, the Dow Jones industrials pushed ahead 192.25 points to 13,038.03 after a late surge Thursday limited its loss to 15.69 points.
The Fed decision means the discount rate -- the interest rate that it charges to make direct loans to banks -- will be lowered to 5.75 percent, down from 6.25 percent.
美国联邦储备决定下调半个百分点对“贴现率”。
The Fed did not change its target for the more important federal funds rate, which has remained at 5.25 percent for more than a year.
The action comes after the U.S. central bank infused billions of dollars into the banking system over the past week to keep that rate from rising above the target level. Other central banks, including the Bank of Canada, have made similar moves.
此前美国央行注入数十亿资金。其它央行，比如加拿大央行，也作类似的动作。
The announcement comes at the end of a week of punishing losses on stock markets amid fears of a global credit squeeze, sparked by the subprime mortgage market in the U.S.
European bourses also responded positively to the Fed decision as London's FTSE 100 index gained 168.3 points to 6,027.2. Frankfurt's DAX 30 moved ahead 57.92 points to 7,327.99 and the Paris CAC 40 advanced 168.56 points to 5,434.03.
Asian shares, though, tumbled overnight, with the Tokyo benchmark diving 5.4 per cent.
Tokyo's Nikkei fell 5.4 per cent -- almost 900 points -- on Friday, the biggest one-day loss since in more than five years. The U.S. dollar's decline worsens earnings prospects for Japanese companies such as Toyota and Sony.
Hong Kong's blue chip-index Hang Seng Index dropped 1.4 per cent and the Korea Composite Stock Price Index lost 3.2 per cent after falling 6.9 per cent the previous session.
China's shares, which had been hitting new daily highs recently, fell for a second straight day, closing down 2.3 per cent.
中国的股市最近一直处于新高
BNN's Michael Kane said the North American market could again be volatile on Friday.
"But then again, as we saw yesterday, when all of the stocks are pulled down like that, it creates some bargains in some people's eyes, and then you get money rushing in from the sidelines to pick up on those bargains," he told CTV Newsnet before trading.
Kane said the effect creates "this very volatile, very choppy trading that we're seeing."
Earlier Friday, Japan's central bank injected 1.2 trillion yen (US$10.5 billion) into money markets -- the third injection this week and triple the amount it injected the day before -- in a bid to curb rises in key interest rates.
日本央行也对金融市场注入万亿日元
Investors worldwide are struggling to regain confidence, analysts said.
全球投资者都在为恢复信心而挣扎。
"The fear factor has overtaken people,'' Song Sen Wun, regional economist at CIMB-GK Research Pte. Ltd., told The Associated Press.
"Whether this is a case of blind panic remains to be seen."
Sen Wun said investors could realize that the fears are overblown as quickly as Monday.
Credit Suisse chief strategist Shinichi Ichikawa in Tokyo said any bad news ahead, such as a bank abroad faltering, could worsen the market jitters.
"The next couple of weeks will be a very tough time for global financial markets,'' he told AP.
不过在市场上人们依然很过敏。 日本一位专家说，在未来的几周内，对全球金融市场来说，依然是很艰难的。
With files from The Canadian Press and The Associated Press
美国联邦储蓄会主席露出了笑容，但是这个笑容太“早”了？！
Federal Reserve Board Chairman Ben Bernanke testifies on Capitol Hill in Washington, in this July 18, 2007 file photo, before the House Financial Services Committee.(AP / Susan Walsh)
Updated Fri. Aug. 17 2007 9:53 AM ET
CTV.ca News Staff
http://www.ctv.ca/servlet/ArticleNe.../stock_markets_070817/20070817?hub=TopStories
A dramatic move by the U.S. Federal Reserve to calm plunging financial markets worldwide sent North American stocks sharply higher on Friday morning.
In response to the economic uncertainty, the Fed approved a half-percentage point cut in its discount rate on loans to banks before trading began.
Toronto's S&P/TSX composite index jumped 343.03 points to 13,191/73 after a 200.06-point slide Thursday wiped out the TSX's gains for the year so far.
The Canadian dollar surged 1.46 cents to 94.46 cents US as the American dollar weakened.
On Wall Street, the Dow Jones industrials pushed ahead 192.25 points to 13,038.03 after a late surge Thursday limited its loss to 15.69 points.
The Fed decision means the discount rate -- the interest rate that it charges to make direct loans to banks -- will be lowered to 5.75 percent, down from 6.25 percent.
美国联邦储备决定下调半个百分点对“贴现率”。
The Fed did not change its target for the more important federal funds rate, which has remained at 5.25 percent for more than a year.
The action comes after the U.S. central bank infused billions of dollars into the banking system over the past week to keep that rate from rising above the target level. Other central banks, including the Bank of Canada, have made similar moves.
此前美国央行注入数十亿资金。其它央行，比如加拿大央行，也作类似的动作。
The announcement comes at the end of a week of punishing losses on stock markets amid fears of a global credit squeeze, sparked by the subprime mortgage market in the U.S.
European bourses also responded positively to the Fed decision as London's FTSE 100 index gained 168.3 points to 6,027.2. Frankfurt's DAX 30 moved ahead 57.92 points to 7,327.99 and the Paris CAC 40 advanced 168.56 points to 5,434.03.
Asian shares, though, tumbled overnight, with the Tokyo benchmark diving 5.4 per cent.
Tokyo's Nikkei fell 5.4 per cent -- almost 900 points -- on Friday, the biggest one-day loss since in more than five years. The U.S. dollar's decline worsens earnings prospects for Japanese companies such as Toyota and Sony.
Hong Kong's blue chip-index Hang Seng Index dropped 1.4 per cent and the Korea Composite Stock Price Index lost 3.2 per cent after falling 6.9 per cent the previous session.
China's shares, which had been hitting new daily highs recently, fell for a second straight day, closing down 2.3 per cent.
中国的股市最近一直处于新高
BNN's Michael Kane said the North American market could again be volatile on Friday.
"But then again, as we saw yesterday, when all of the stocks are pulled down like that, it creates some bargains in some people's eyes, and then you get money rushing in from the sidelines to pick up on those bargains," he told CTV Newsnet before trading.
Kane said the effect creates "this very volatile, very choppy trading that we're seeing."
Earlier Friday, Japan's central bank injected 1.2 trillion yen (US$10.5 billion) into money markets -- the third injection this week and triple the amount it injected the day before -- in a bid to curb rises in key interest rates.
日本央行也对金融市场注入万亿日元
Investors worldwide are struggling to regain confidence, analysts said.
全球投资者都在为恢复信心而挣扎。
"The fear factor has overtaken people,'' Song Sen Wun, regional economist at CIMB-GK Research Pte. Ltd., told The Associated Press.
"Whether this is a case of blind panic remains to be seen."
Sen Wun said investors could realize that the fears are overblown as quickly as Monday.
Credit Suisse chief strategist Shinichi Ichikawa in Tokyo said any bad news ahead, such as a bank abroad faltering, could worsen the market jitters.
"The next couple of weeks will be a very tough time for global financial markets,'' he told AP.
不过在市场上人们依然很过敏。 日本一位专家说，在未来的几周内，对全球金融市场来说，依然是很艰难的。
With files from The Canadian Press and The Associated Press
美国联邦储蓄会主席露出了笑容，但是这个笑容太“早”了？！
Federal Reserve Board Chairman Ben Bernanke testifies on Capitol Hill in Washington, in this July 18, 2007 file photo, before the House Financial Services Committee.(AP / Susan Walsh)
