The start of the week on Wall Street brought increased prices of blue-chip stocks, with the highest gains seen in the stock prices of major industrial companies.
The New York Dow Jones index rose by 0.3 percent, to 13,121 points. The S&P index slightly weakened, by 0.03 percent, to 1,446 points. However, the technology Nasdaq strengthened by 0.14 percent, to 2,509 points. The value of the Dow index strengthened mainly due to the rise in stock prices of major industrial companies like Caterpillar, which would benefit from the lowering of key interest rates in the U.S. The American central bank, the Fed, on Friday lowered the discount rate by half a percentage point in an effort to stabilize financial markets. This unexpected move by the Fed followed a month of declining stock prices in global markets due to issues with risky U.S. subprime mortgage loans. "There is currently a significant divide on Wall Street regarding whether the market has only reached a bottom or if it is merely a short-term technical recovery. Nevertheless, I believe that the fear of implosion in the financial sector is gradually dissipating," said Michael Metz, chief investment strategist at Oppenheimer & Co. Caterpillar’s stock rose by 1.9 percent, contributing the most to the strengthening of the Dow index. Honeywell International’s stock increased by 2.5 percent, and Alcoa’s by 3.1 percent. In European markets, stock prices rose sharply thanks to mining and industrial stocks. The London FTSE index rose by 0.24 percent to 6,079 points. The Frankfurt DAX gained 0.4 percent in value, closing trading at 7,408 points. (Hina)
