Markets show optimism after sad Q1
The Canadian Press
Overseas stock markets and Wall Street index futures were positive on the first day of the second quarter of 2008, while crude oil declined toward US$100 US a barrel and gold dipped under US$900 an ounce.
The Canadian dollar opened down 0.02 cent at 97.40 cents US.
The good feeling on Wall Street came on declining commodity prices and new recapitalization plans at UBS AG and Lehman Brothers Holdings.
UBS said it will take a new $19-billion writedown on mortgages and other debt instruments, following an $18-billion writedown last year. But investors focused the Swiss bank’s announcement that it will issue up to $15 billion in new stock and that Marcel Ospel has resigned as chairman of the European bank hardest hit by the U.S. subprime mortgage catastrophe.
Meanwhile, Lehman Brothers said it will sell three million convertible preferred shares due to “investor interest.”
Crude oil was at US$100.94 a barrel on the New York Mercantile Exchange, following a slippage under $100 overnight, while gold was at US$901.40 an ounce, off $20.40 after pulling up from deeper declines in overseas dealings.
On Monday, Wall Street managed a modest gain in the final session of a dismal first quarter. But the major indexes still ended the first three months of 2008 with deep losses.
Overseas, Tokyo’s Nikkei index gained one per cent on Tuesday’s session, while the Hang Seng index in Hong Kong advanced 1.25%.
The FTSE 100 index was up 0.8% near midday in London, while the German DAX rose 1.4% and the Paris CAC 40 added 1.5%.
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