Stock markets enjoyed another positive day on Friday, stretching a remarkable rally in Toronto and New York to 4 days (maybe 5 after today) largely sparked by good news from the financial sector.
Canada’s main stock index the S&P/TSX composite index gained by 0.26% and advanced 9.5% for the week keeping pace with the global stock markets.
This morning stocks around the world climbed for a 5th day as the Group of 20 vowed to clean up toxic assets, Federal Reserve Chairman Ben S. Bernanke said the recession may end soon and Barclays bank reported a “strong” start to 2009.
Barclays, the United Kingdom’s 3rd largest lender, jumped 22% after stating its businesses continue to perform well. UBS and Citigroup gained more than 8%.
The MSCI World Index climbed 1.3% in London. The index of 23 developed nations has surged 11% since March 9th as Citigroup, Bank of America and JPMorgan Chase said they made money during the first 2 months of 2009. The global index has still lost 17% this year.
A lot of banking action has been taken and this is a positive sign. It is a bear market, but you can have sizable rallies.
Futures on the Standard & Poor’s 500 Index added 1.2% as Bank of America climbed. Fed Chairman Bernanke said in an interview broadcast on CBS “60 Minutes” yesterday that, should the government succeed in stabilizing financial markets, the recession will probably end this year and the economy will expand in 2010.
Finance chiefs from the G-20 this weekend vowed to work together to clean up the toxic assets that helped trigger the financial crisis and led banks to rack up more than $1.2 trillion in losses. G-20 officials outlined guidelines on how governments should rid banks of distressed securities.
U.S. Treasury Secretary Timothy Geithner said separately he will soon announce details of his plan to help banks clean up their assets.
The S&P 500 rallied the most since November last week as financial shares capped the steepest advance on record. The U.S. stock benchmark index has declined 16% in 2009, rising in only 2 of the last 10 weeks, as falling shares of banks raised concern the government would be forced to nationalize some banks.
Oil is down this morning as OPEC agreed to keep oil output unchanged.
Regards,
Wilfred Vos Bcs, FMA, CIM, CFP, FCSI, DMS, CBV, MBA, CFA
SVP & Partner
