While the rest of the world took a beating during Friday’s market hours, the United States managed to escape with only minor cuts and bruises as the Dow closes the day down 215 points, or 2.47%. The global economy fell on fears of a full-blown recession looming in the near future. This week, both Japan and Europe announced their GDP fell for the first times in over 15 years. Despite all the central banks and governments are trying to accomplish, investors believe it won’t be enough to stop the market’s downward spiral.
Asian markets fell drastically today as the Nikkei hits a 26-year low after falling 9.60%. Toyota’s (TM: 66.09, -2.91 (-4.22%)) quarterly sales fell for the first time in 7 years this past quarter. Not helping the cause, the yen is now at a 13-year high against the dollar. On the opposite side of the spectrum, the British Pound experienced its biggest drop in over 37 years today. The FTSE ended the day down 5.00%, over 6.00% on the week.
The Treasury announced it is not only looking to relieve failing banks to free up credit, but it is also considering ways to uphold insurance companies as well. That is of course if AIG doesn’t borrow every last penny the U.S. Government owns first. Earlier today, AIG (
AIG: 1.70, -0.40 (-19.05%)) stated that they might be needing more than their allotted $123 billion to keep from going under. How well could their top earners have done to deserve their $440,000 spa trip? AIG also announced that they have already scheduled their next retreat at the spa… this time they’re the ones
giving the massages for a fund raising campaign AIG just launched.
OPEC states that they will be cutting production by 1.5 million barrels a day to help relieve falling prices. Speculators don’t feel that will be enough to reverse the declining price trend, and oil fell below $65.00 once again. Gold rebounded 2.67% today after falling every other day this week.
PNC Bank (PNC: 58.88, +2.00 (+3.52%)) will purchase National City (NCC)) for $5.2 billion, 19% less than yesterday’s closing price. PNC, Pennsylvania’s largest bank, will acquire National City’s 1,400 branches in 9 states.
Chrysler (DAI: 27.86, -2.46 (-8.11%)) will be cutting salaried workers by 25% to limit expenses. They also stated that they will be shutting down one of their S.U.V. plants. Other expenditure cuts are being expected in the future.
September’s existing home sales report was released today, beating Street estimates of 4.92 million, by 260 thousand. Though this number shows momentum of the housing markets, and typically predicts sales of appliances, this 5.5% gain can be attributed to the cheap foreclosed homes offered by banks. The median sales price has dropped 9% in one year, to $191,600.
That’s all for today, catch me Monday, same time, same place, for the Bullish Banker’s Daily Market Recap.
