21 Aug 2008

Wall St rises

9:06 am on 21 August 2008

Stocks in the United States rose on Wednesday even as investors dumped Fannie Mae and Freddie Mac on fears of an imminent government bailout of the housing finance companies.

Shares of Fannie Mae and Freddie Mac lost more than 22% each. Shares of Fannie Mae, the biggest U.S. provider of housing finance, plunged 26.8% to $US4.40, while Freddie shares fell 22.1% to $US3.25.

Their stocks are at almost two-decade lows. But shares of big banks rose. Shares of top mortgage lender Wells Fargo & Co rose 4.1%.

Shares in Hewlett-Packard rose more than 5% after announcing on Tuesday that quarterly profit was up by 14%.

Oil gained for a second day to $US114.98 amid concerns about Russia's possible reaction to a U.S.-Poland missile shield. Also, Goldman Sachs reiterated its forecast of $US149 a barrel for US crude by the end of the year.

The Dow Jones industrial average was up 68.88 points, or 0.61%, at 11,417.43. Standard & Poor's 500 Index was up 7.85 points, or 0.62%, at 1,274.54. The Nasdaq Composite Index was up 4.72 points, or 0.20%, at 2,389.08.

Trading volume was light on the New York Stock Exchange, with about 1.1 billion shares changing hands. About 1.8 billion shares were traded on the Nasdaq.

European shares also up

European shares were lifted a little by commodity stocks on Wednesday.

The FTSEurofirst 300 index of top European shares ended up 0.51% at 1,165.31 points. The index fell 2.5% on Tuesday.

Germany's DAX rose 0.6% and France's CAC was up 0.8%.

European stocks are down some 22% this year.

In Britain, the FTSE 100 closed up 51.4 points, 1%, at 5,371.8, after losing 3.2% in the previous three sessions. The index is down nearly 17% for the year to date.

Miners held onto earlier gains after metal prices eased in late trade. Energy stocks also rose even though crude oil prices slipped in late session.

NZ market

The New Zealand sharemarket finished on a higher note on Wednesday, as the NZX 50 index rose seven points to 3326 on turnover of $73 million.

Telecom was up 7 cents to $3.29, Contact Energy was down 7c to $8.56 and Fletcher Building was up 15c to $6.95.

Fisher & Paykel Appliances was unchanged at $1.88.

Sky Network Television was down 8c to $4.95 after posting a 26% increase in profit to $97.7 million.

Tourism Holdings was down 1c to $1.41 after profit rose 7% to $14.3 million in the year to June.

PGG Wrightson was up 11c to $2.95 after making a full-year profit of $73.2 million on Tuesday. New Zealand Oil & Gas was down 3c to $1.45.

The dollar was buying US71.50 cents, 81.93 Australian cents, 38.30 pence, 78.56 yen and 0.4842 euro. The Trade Weighted Index was 66.49.


The Australian sharemarket closed firmly in the black. The S&P/ASX200 was up 63.1 points, or 1.3%, to 4929.5, while the All Ordinaries gained 67.1 points, or 1.36%, to 4997.5.

The September share price index futures contract gained 20 points to 4,882.