In a co-ordinated strike, $180bn in liquidity has been offered by central banks and regulators to banks outside the US in desperate need of dollars. For its part, the Bank of England has pumped 40 billion USD (£22.3 billion) into money markets, over four times the amount it pumped in on Monday when Lehman collapsed. Other actors in the stage-play included the ECB, Bank of Canada and Bank of Japan. Lehman, HBOS and AIG this week have led to banks hoarding cash and pushing up the rates of inter-bank lending. When commercial banks end up in a liquidity freeze, central banks step in to ease the cash deadlock.
The FSA has banned the short-selling of UK financial stocks, "a move unprecedented in modern times" according to the FT on Thursday, categorising it as a "market abuse" offence. Market makers are exempt from this rule. The rule takes effect from midnight Thursday until January 2009, and there will be a review after 3o days which may result in the ban being extended to other sectors.
Barclays also staked their claim on Lehman's bond indexes.
MS redefined volatility Thursday. After 1 p.m. Thursday,MS dipped below $13 (an all time low), beginning to rally around 2:30 p.m. Morgan's shares with news of a possible government-led solution to the loan crisis, and by 3 p.m., the stock hit $23.
EuroStoxx closed at the 3000 mark, 59bps below Wednesday's close.
Lloyds TSB paid £12bn for HBOS (the transaction having been waved through by Gordon Brown, side-stepping the Competition Commission), 232p per share. City AM's headline today is "CONTAGION" with a picture of a horse and the comment "LLOYDS TSB and HBOS will create a megabank with £1 trillion in assets. Picture:PA".
In stark contrast to the seriousness of the day's events in the money markets, the london paper ran lead stories on how madonna helped Gwyneth Paltrow out of post-natal depression and how Kate Middleton, girlfriend of Prince William, fell down at a roller disco in Vauxhall.
No comments:
Post a Comment