UK investors have reacted positively to the upturn in the American markets yesterday following specul...
In London the benchmark index the FTSE 100 rose 34.2 points to 5585.8 and the Techmark gained 10.31 to 2028.78 with telecommunication stocks gaining value. Marconi rose 15.5p to 379.5 and Colt gained 48p to 873p. Other gainers included Energis, which rose 9.5 to 320p and ARM, which gained 10p to 315p. British Telecom rose 15p to 515p.
The prospect of a cut in US interest rates lifted the American markets yesterday with the Nasdaq climbing more than 3%. At the close of trade Monday, the technology-based index had climbed 60.27 points, 3.2%, to 1951.18 while the Dow Jones gained 135.70 points to 9959.11 and the Standard & Poor 500 added 20.28 to 1170.81.
Investors will be hoping for a cut in interest rates today but even if the Federal Reserve does reduce base rates it is difficult to see how the economy will benefit or stop market indices from falling as one firm after another announces a profit warning. There have already been two interest rate cuts since George W Bush came to power and the market downturn hasn't abated yet.
Having said that, tech stocks rose in value yesterday. Oracle, down 47% in value this year alone, rose $1.38 to 15.44, Cisco 46% lower this year gained 88 cents to $20.81 and Qualcomm 29% lower for the year added $7.88 to 58.19.
Following last Friday's decision by the Organisation of Petroleum Exporting Countries (OPEC) to cut production by double the expected 500,000 barrels per day oil, companies subsequently gained in value. Amerada Hess added $2.09 to 77.48, Chevron rose $1.56 to 89.06 and Texaco rose $2.01 to 67.16.
Japan's benchmark index, the Nikkei 225 remains at 12,190.97 as traders and investors alike enjoy a public holiday. With the Nikkei not trading today, it was left to the Hang Seng to reflect on US market gains. Investor enthusiasm does not appear to have reached Hong Kong. The Hang Seng lost 233.83 points to 13,223.86 with China Mobile falling 3.4% to HK$36.80.
The Singapore Strait Times rose 0.6% with Omni Industries climbing 4.8% to S$2.61 after the electronics group said full year profit rose 60% to S$47.3m from $S27m a year ago. Australia's ASX200 climbed 13.70 to 3229.70 thanks to old economy stock Rio Tinto, which rose 4.9% to A$33.95. The company holds an interest in Billiton, which yesterday announced it's to be acquired by BHP, whose share price fell 5.1% to A$20.31.
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