World markets regain some of recent losses; Wall St has one of its best-ever trading days; China latest to cut interest rates; bombs explode in Somalia; IMF to loan $25 billion to Hungary; and more
Top of the Agenda: Major Market Gains
The Dow Jones Industrial Average and S&P 500 Index both climbed roughly 11 percent yesterday in one of the strongest trading days in the history of U.S. markets. The Wall Street Journal reports the gains came with traders anticipating that the U.S. Federal Reserve will cut its benchmark interest rate today, perhaps 50 to 75 basis points.
Markets across most of Asia and Europe reflected the U.S. run-up in their second straight day of major gains; Japan's Nikkei index gained 7.7 percent today (Bloomberg), and indices in both Britain and France were roughly 5 percent higher (WSJ) in early trading.
The Financial Times reports that part of the reason for the sharp gains has been that speculation about an interest rate cut in Japan has eased investor fears about the impact of a practice known as the carry trade. A new CFR.org Daily Analysis explains the carry-trade and how currency concerns fit into the current market turmoil.
Pacific Rim: China Rate Cuts
South Korea: Yonhap reports on political discontent in Seoul over economic stagnation; the leader of South Korea's main opposition party today pressed President Lee Myung-bak for a complete makeover of the country's economic policies.