Breaking News & Stocks

The news came as a relief to a market that has fallen sharply in recent months on any negative news about the insurers; investors feared that a downgrade of the insurers' credit ratings would lead to billions of dollars in write-downs of securities held by already troubled banks and investment firms. Rating agencies including S&P have been under pressure to downgrade the insurers after they weakened their financial positions by insuring subprime mortgage securities that later collapsed.

There has been speculation that Ambac might find sufficient capital early this week to hold onto the stellar "AAA" rating it needs to remain in the municipal bond business. Municipalities and companies use these insurers to back bonds, allowing them to get higher ratings and cheaper financing.

"This is essentially evidence that S&P has signed off any tentative deal," said Charlie Smith, chief investment officer at Fort Pitt Capital Group, of the rating agency's announcement.

Financial institutions have already suffered billions of dollars in losses from securities that lost value during the fourth quarter.

Chris Johnson, president of Johnson Research Group, said the market continues to look for any sign that financial stocks will make it through the credit crisis. Experts believe keeping bond insurers whole will spare greater losses for major global banks and brokerages.

"Even the smallest bit of positive news and the market takes off," he said. "Investors get excited if they sense a bottom in the financials because they've been the Achilles' heel of this market."

The Dow rose 189.20, or 1.53 percent, to 12,570.22.

Broader stock indexes also closed with a solid advance. The Standard & Poor's 500 index rose 18.69, or 1.38 percent, to 1,371.80; and the Nasdaq composite index added 24.13, or 1.05 percent, to 2,327.48.

Advancing issues outpaced decliners by about 2 to 1 on the New York Stock Exchange. Consolidated volume, which spiked after S&P affirmed the bond insurers, came to 3.71 billion shares from 3.46 billion on Friday.

Bond prices fell. The yield on the 10-year Treasury note, which moves opposite its price, rose to 3.90 percent from 3.80 percent late Friday. The yield edge up to 3.91 percent in after-hours trading.

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

Oil prices hovered near $100 a barrel with supply concerns heightened by a Turkish military incursion into northern Iraq and warnings by Iran against further international sanctions. A barrel of light, sweet crude rose 42 cents to $99.23 on the New York Mercantile Exchange.

Wall Street also rose after the National Association of Realtors reported existing homes fell less than forecast in January. Investors, while still wary of recession, grew hopeful the housing market might be on the verge of bottoming out with a rebound expected to start toward the end of this year.

But, that wasn't enough to help boost shares of banks like Citigroup Inc. after Goldman Sachs said it expects several more multibillion-dollar write-downs across the sector. The report said Citi faces a potential $12 billion write-down, and shares slipped 38 cents to $24.74. Ambac shares surged $1.70, or 16 percent, to $12.41; and MBIA jumped $2.40, or 19.7 percent, to $14.58.

In other corporate news, Visa said in a Securities and Exchange Commission filing it will offer 406 million shares at $37 to $42 per share. The IPO was seen as a positive sign that a major financial company feels confident to go public despite the ongoing market turbulence.

TakeTwo Interactive Software Inc. surged $9.53, or 55 percent, to $26.89 after rival Electronic Arts Inc. renewed its bid to buy the company. The stock is now trading at a 52-week high on speculation the bid could go hostile.

There was good news for cancer drug manufacturer Genentech Inc. The Food and Drug Administration granted an accelerated approval for its Avastin treatment, which is administered with a chemotherapy treatment to breast cancer patients. Shares rose $6.36, or 8.8 percent, to $77.96.

Lowe's Cos. reported a drop in fourth quarter earnings and cited the weak housing market. However, shares of the home improvement retailer rose 91 cents, or 3.8 percent, to $24.50 amid hopes that the housing slump might soon hit a bottom.

The Russell 2000 index of smaller companies rose 15.03, or 2.16 percent, to 710.46.

Overseas, Tokyo closed 3.07 percent higher. In London, the FTSE 100 rose 1.89 percent, Paris' CAC 40 advanced 1.12 percent, and Frankfurt's DAX gained 1.96 percent.

Japan’s Nikkei ends at 6-week closing high

Tokyo, Feb 25: Japan's Nikkei average rose more than 3% on Monday, posting a six-week closing high as market sentiment improved after a newspaper reported that China's sovereign wealth fund planned to buy as much as USD 10 billion in Japanese stocks.

Another big boost came from financial shares including top insurer Millea Holdings and banks as talk of a US bond insurer rescue plan eased concern about the sub-prime loan crisis.

Inpex Holdings Inc and property firms advanced as Britain's Times newspaper said the USD 200 billion China Investment Corporation (CIC) could consider purchasing a large stake in the oil and gas developer and eventually move towards direct investments, such as in real estate.

"For Japanese stocks, the biggest positive driver for today is the China sovereign wealth fund news," said Fujio Ando, senior managing director at Chibagin Asset Management. The Nikkei average rose 3.1% or 414.11 points to end at 13,914.57, its highest close since Jan 15.

"The next target will be whether the Nikkei is able to touch 14,000, but that will still depend on the outlooks for economic health and next year's earnings," Ando said.

In the United States this week, the market is awaiting the release of several price indexes and growth indicators, which will help determine whether the Federal Reserve will keep cutting interest rates as it seeks to stimulate the economy.

The broader TOPIX index was up 2.6% or 34.17 points at 1,355.54, its highest finish since Feb 4.

Market participants said that while stocks had touched bottom and the level was gradually rising, it was hard to see sustained gains keeping the Nikkei average above 13,800, which was a selling point during a rally earlier this month.

US stocks staged a late rally on Friday on news that banks were near a deal to bail out bond insurer Ambac Financial and that a rescue could come this week, but a source said while progress had been made the deal might still fall through.

Bureau Report

asian market in red

europeon market strugling to stay in green.

Lalu presents mega Budget 2008-09 for Railways, announces record profit lalu,s Balance Sheet


Cash surplus of Rs 25,000 crore for FY08
Additional 20,000 cr earned on freight service
Railway Fund Balance up 2,000 cr
Rail Plan soars from 11,000 cr to 33,000 cr
Rs 49,250 crores spent as investment on new projects
Operating Ratio of 76%

Freight


Achieved 790 tonne payload target
Wagon turnaround led to a profit of Rs 233 cr
3000 new bogies to freight trains
Uncoaching earning to increase to 4000 cr
Shipping and road transport companies were allowed to run dedicated trains
Freight loading increased by 10%
Freight income target is now Rs 440,000 cr
Uncoaching target of 20,000 cr
160% increase in a decade in freight loading
1000 mn tonnes target for freight loading
Special fund for coal and steel corridor
75000 cr to be spent on this including East and West dedicated freight corridor
336 mn tonne coal freight target in FY09
New wagon lease plan
Wagons to be available for lease for 20 yrs
Leasing companies to have all the freedom
Companies to get rebate if they lease
New project for bulk handling of perishables; new terminals to be developed for this
New projects to be developed on private land; if at all in Railway land then they have to pay for the land
120 mn tonne freight from steel, target is 200 mn tonne by FY11
Freight target of 200 mn tonne cement
Ludhiana-Howrah and Delhi-NPT dedicated freight corridors
Others to be taken up
7 new container depots planned
New BRM 22.9 tonne axle load wagons to be developed

Rebates


50% concession for AIDS patients
30% rebate for male senior citizens
50% for women senior citizens
Paramveer Charka and Ashok Charka winners along with companion can use their card now even in Rajdhani and Shatabdi trains to travel free

Safety


Close circuit cameras at all important stations
Decrease in accident rate from 0.28% to 0.23%
New bridges, new signalling system to be completed to bring down accident rate further
To remove human error ACS is being developed, and new track testing system is being worked
ACS was tried out in NF railways, it has been encouraging
Now in SC, WR to try out ACS
Rail Impact detectors are being developed
Analogue machines to be replaced by digital machines for signalling
Unmanned crossing to be eliminated in double lines by building RoB; will do it on its own through BoT as state govts are not helping with funds
16600 level crossings, 18000 unmanned crossings; pose greatest danger.
Plan to man most of the unmanned crossings
Gangman to be promoted to man-level crossings
As gangmen will move up as cabin, coolies will be trained to work in Grade 4 as gangmen

Hi Rakesh,
May I know the site you use to track europian market. Thanks,

check reuters {dot} com