4:20 pm : The S&P 500 posted its largest percent gain in 69-years on Monday, snapping an eight session losing streak in the process. The rebound was fueled by several governments taking steps to shore up the financial system and Morgan Stanley (MS 17.99, +8.31) completing its deal to receive a capital infusion from a Japanese bank.
The S&P 500 surged 11.6% in broad-based buying interest and ended the day at sessions highs following a late-session surge. The Dow rose 936 points -- its largest point gain ever and largest percent gain since 1933. All ten of the economic sectors rallied, with gains ranging from 7.2% (industrials) and 18.5% (energy). Overseas markets also rallied, Hong Kong's Hang Seng spiked 10.1%, and Europe's Eurostoxx 600 rose 9.9%.
With regard to the global efforts to help the financial markets, the Fed and other central banks announced plans to provide as much dollar liquidity as needed in short-term funding markets. The 15 eurozone countries said they will guarantee new bank debt until the end of 2009. In addition, several European countries announced plans to guarantee interbank landing and directly inject capital in financial firms. The U.K. government plans to inject up to $63 billion in three U.K. banks.
The U.S. is expected to outline a comprehensive plan of its own as soon as Tuesday, and is likely to include interbank lending and bank debt guarantees, and direct capital injections in financial institutions.
Investors will have a clearer picture of how credit markets will react to the measures on Tuesday when banks and the Treasury markets reopen. They were closed on Monday in observance of Columbus Day.
A glitter of hope?
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Originally Posted by scheuch13
