Citigroup Bail Out Announcement Sent Markets Soaring

November 25, 2008

New York (ChattahBox) — Stock market took comfort in announcement from the government to bail out the financial giant, Citigroup Inc. Share prices moved sharply higher on Monday supported by positive signals from the Obama administration as well. This led the Asian stock markets to move up as well making most of the Asian indexes close higher at the end of day trading. The Australian share market also jumped more than 3 percent after Citigroup’s bail out drove New York stocks higher overnight.

“I think it’s the market breathing a sigh of relief that someone came up with an answer on Citicorp, number one,” said David Francis, head of equities at Thrivent Asset Management in Appleton. “Financial stocks were gangbusters pretty much across the board today.”

The Dow Jones surged nearly 400 points and all other major indexes soared 4.5 percent. The rally gave Dow Jones biggest two-day percentage gain since October 1987. The investors had already been anticipating this move from the government but a formal announcement on Monday heartened the traders.

Apart from the $700 billion bailout plan, the government has also bailed out the insurance giant, AIG and taken over the lenders Fannie Mae and Freddie Mac. Traders are heaving a sigh of relief at such a step taken from the government which assures them government is capable of supporting a banking system ailing under bad debts and flagging confidence.

Citi shares jumped almost 58% Monday, firing up the broader bank sector. Other banks and institutions like Merrill Lynch, Morgan Stanley, Bank of America, JP Morgan Chase, Wells Fargo, also saw a rally in their stock prices.


Comments

One Response to “Citigroup Bail Out Announcement Sent Markets Soaring”

  1. grizzlyBear on November 25th, 2008 11:00 pm

    Just who the hell is going to pay for all these bailouts. the long sufferring middle class that has largly disappeared anyway. tax the rich and they move off-shore.
    Face it, the same thing that rules wall street and the markets is the thing that ruled the dying nazi party: delusion. DELUSION — now your only friend.

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