US stocks rise on central bank infusions
New York, December, 12, 2007- US stocks rose across the board Wednesday after a massive world-wide cash injection into the banking system to help fight the credit squeeze sparked by the meltdown in US subprime home mortgages.The news that the US Federal Reserve, the European Central Bank, the Bank of England, the Bank of Canada and the Swiss National Bank were taking the move buoyed shares despite warnings from the second and fourth largest US banks of further write-offs in the fourth quarter due to the crisis.
The Fed was making up to 24 billion dollars available to the ECB and Swiss National Bank to increase the supply of dollars in Europe. It also planned four auctions, including two this month that will add as much as 40 billion dollars to increase cash in the US.
Technology and energy shares led the advance.
The cash injection helped the S&P 500 recoup about a quarter of its loss from Tuesday, when the Fed's quarter-point rate cut disappointed investors.
The benchmark Standard & Poor's 500 Index gained 8.94 points, or 0.61 per cent, to 1,486.59. The blue-chip Dow Jones Industrial Average climbed 41.13 points, or 0.31 per cent, to 13,473.90. The technology-heavy Nasdaq Composite Index rose 18.79 points, or 0.71 per cent, to 2,671.14.
The US dollar fell to 67.99 cents, from 68.20 euro cents on Tuesday. It rose to 112.19 yen from Tuesday's 110.69.
Gold was 814 dollars per fine ounce. dpa