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Monday, 17 March 2008 04:55 |
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US markets were volatile last week as the relief provided by the Fed's $200bln liquidity injection was overshadowed by Bear Stearns' bailout from the Fed and JPMorgan.
The Fed may announce Tuesday a 50bps rate cut to 2.5%, the lowest level since March 2005. This morning the Fed announced new measures to increase liquidity in the credit market including a 25bps cut in the discount rate to 3.25%. Stocks in the Health Care Equipment, Automobiles & Compo. and Diversified Financials sectors posted the biggest WoW declines. Shares in the Consumer Services and Materials sectors gained WoW. This week, expect indices to remain under pressure with downside risk intact.
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