The US may have passed a bailout of US$700 Billion (S$ 1 Trillion) but jittery investors or most of us remain pretty much in doubt whether that move is able to arrest the financial hole that has begun. There were signs that a looming recession is on the horizon.. loss of jobs amounting to 159, 000. However, the signals were mixed: High yield bonds eased slightly but Treasury bills moved against expectations.
Oil prices fell to an eight-month low below $90 a barrel Monday on speculation that the spreading financial crisis will exacerbate a global economic slowdown and cut demand for crude oil. Significant gains by the U.S. dollar against the euro also contributed to slumping oil prices. For Singapore, for now: the strong fundamentals have pretty kept us steady.. But like what the ministers have been saying, we would be affected, if the US cannot hold out.
Japan's Nikkei-225 index plunged 4.5 percent, hitting a five-year low. Stocks tumbled 5.1 percent in Hong Kong, 4.1 percent in Sydney, 2.8 percent in Singapore and 2.9 percent in Shanghai.
As the crisis deepened in Europe, Britain was set to announce a rescue package for its ailing banking industry before markets opened on Wednesday after key bank shares tumbled 40 percent.
The central banks of Japan and Australia pumped more emergency funds into the financial system while the Hong Kong Monetary Authority said it will cut its key interest rate by 100 basis points from Thursday.
The US Federal Reserve said it would buy up short-term commercial paper or company debt in an effort to kick-start credit flows and fight off the liquidity crunch triggered by a wave of US mortgage defaults.
But markets took little comfort from the latest measures. Wall Street 's Dow Jones index sank 5.11 percent to a five-year closing low.
No matter, we should see the effects of these fiscal priming measures in a few months time. BUT Alongside all the BAD news, this also affords us an opportunity to buy into depressed stocks, depressed funds...
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