After major central banks injected a huge amount of cash into banking systems, the situation on the American stock market calmed down on Monday, with only minor declines in stock prices, mainly in the financial sector.
The New York Dow Jones index fell by 0.02 percent to 13,237 points. The S&P index weakened by 0.05 percent to 1,453 points. The technology Nasdaq lost 0.1 percent in value, closing at 2,542 points. For most of the trading session, stock prices strengthened, led by shares of aircraft manufacturer Boeing and technology leader Apple. This suggested a stabilization of the stock market after several days of sharp fluctuations due to worsening credit conditions.
However, signs that a deterioration in the credit market could limit merger and acquisition activities restricted the rise in stock prices. Specifically, private equity firm Kohlberg Kravis Roberts & Co. announced that its profits could be eroded by weak conditions in the borrowing market. A $3 billion rescue package organized by the prestigious investment bank Goldman Sachs for its hedge fund, which was affected during recent turmoil in the subprime mortgage market, provided support to the stock market. This move stands out from the actions of other major banks, which have closed those funds. Goldman Sachs’ stock fell by 1.7 percent, while financial stocks, on average, dropped by 0.8 percent.
