breaking news friends....

Fed cuts interest rates by 50 basis points. frm 6.25 to 5.75.. of course it is a temporaly relief.. but i think this will stop the global carnage..

lets see where dow closes and yen.

chintan

they have only cut the Discount rate.

The discount rate is the interest rate charged to commercial banks and other depository institutions on loans they receive from regional Federal Reserve lending facilities. It differs from the key federal funds rate, which is the rate at which private institutions lend to other depository institutions overnight.

The result, as I type this, DOW INDUSTRIALS up more than 300 points in opening minutes; NASDAQ up 2.5%.

Fed cuts discount rate
The central bank, citing market conditions that have 'deteriorated,' cut the symbolic discount rate by a half of a percentage point.
August 17 2007: 8:41 AM EDT

NEW YORK -- The Federal Reserve, reacting to concerns about the subprime lending crisis and the volatility in the financial markets that have resulted from it, announced Friday that it is cutting its so-called discount rate temporarily by a half percentage point, to 5.75 percent.

The discount rate is the rate the Federal Reserve banks across the country charge qualified lenders - mainly banks - for temporary loans. It is largely symbolic.

The central bank did not change its more closely watched federal funds rate, which affects rates that consumers pay on various types of loans. That rate remains at 5.25 percent.

The Fed last met Aug. 7 and decided to leave both the federal funds and discount rates unchanged. But since then, stocks have plunged further due to fears that some financial institutions and hedge funds were in serious trouble because of the mortgage meltdown.
Read the Fed's statement

Mortgage lender Countrywide Financial (Charts, Fortune 500), for example, announced Thursday that it needed to tap an $11.5 billion line of credit because of liquidity problems. That came a day after an analyst at Merrill Lynch suggested that Countrywide might need to declare bankruptcy.

In a statement, the Fed said that it took the move to "promote the restoration of orderly conditions in financial markets."

In another statement, the central bank indicated that "financial market conditions have deteriorated, and tighter credit conditions and increased uncertainty have the potential to restrain economic growth going forward."

The Fed added that "although recent data suggest that the economy has continued to expand at a moderate pace, the Federal Open Market Committee judges that the downside risks to growth have increased appreciably" and that the Fed was prepared to take more action if necessary.

Stock futures, which were initially trading lower Friday following another wild day Thursday, surged higher following the Fed's announcement.

Good for liquidity but might weaken the $ further. Yen can well become the new mkt villain.

Regards,
Kalyan.

A Temporarily Relief For Technical Overdue Oversold Markets.
12000 Is On Cards....

short term the market will be down....