Latin America stocks soar on US bank rescue plan
Associated Press, 03.23.09,
Latin American stocks soared Monday as investors bet a U.S. plan to absorb $1 trillion in toxic bank assets would ease credit and boost growth in the region's top trading partner, the United States.
Brazil's benchmark Ibovespa index gained 5.9 percent to 42,439, its highest close since Feb. 6. Shares in state-run oil company Petroleo Brasileiro (nyse: PBR - news - people ), which comprise 15 percent of the index, soared 6.1 percent to 30.86 reals as oil prices hovered near a four-month high.
Mexico's IPC index meanwhile climbed 5.1 percent to 20,346, its highest since Feb. 9. The peso gained slightly to 14.12 to the U.S. dollar.
Argentina's Merval index increased 5.2 percent to 1,125, while
Latin American equities have been pummeled by the world economic crisis, which has frozen credit and slashed demand for the commodity exports on which many of its biggest companies rely.
But investors were encouraged Monday as U.S. Treasury Secretary Timothy Geithner outlined long-awaited details of a government plan to absorb toxic mortgage securities and other bad assets from banks' books, tapping its $700 billion financial rescue fund and help from the Federal Reserve, Federal Deposit Insurance Corp. and private investors. The program is meant to revive stalled credit markets.
The Dow Jones Industrial Average rose 6.8 percent to 7,776 in New York, its highest since Feb. 13 and the fifth biggest point-gain in the Dow's history.
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Investors also welcomed news of an unexpected 5.1 percent increase in existing home sales in the
Gains in the
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