US stock markets got a lift from the Federal Reserve's latest interest rate cut as the week's economic news confirmed the US economy is no longer accelerating and has struck a few worrisome potholes.
Despite the rebound, Wall Street is hoping that Congress will approve a giant stimulus package aimed at mitigating an economic slump.
In the week to Friday, the benchmark blue-chip Dow Jones Industrial Average rose 4.39 percent to close at 12,743.19.
PHOTO: AP
The Dow is down 4 percent for the year to date, however.
The tech-laden NASDAQ composite gained 3.74 percent to 2,413.36 while the Standard & Poor's 500 index increased 4.87 percent to 1,395.42.
All three indexes have lost considerable ground in recent months amid a worsening housing slump and a related credit squeeze which have triggered losses at major banks.
"While short-term prospects seem to be unraveling, and there continues to be hand-wringing about the ultimate fate of the bond insurers, markets are detecting a glimmer of light at the end of the tunnel," economists at Global Insight said in a briefing note.
Some investors are fearful that credit woes could sap the financial health of bond insurers, but one of the world's largest bond insurers, MBIA, eased market nerves this week by announcing it had raised fresh capital.
Wall Street also cheered a decision by the Fed to cut its key federal funds interest rate by half a percentage point to 3 percent on Wednesday.
The central bank cut rates just a week after it had slashed borrowing costs by an historic three quarters of a percentage point amid mounting economic uncertainty.
Government surveys this past week confirmed the giant US economy is sailing in turbulent waters: Fourth-quarter economic growth slowed to a 0.6 percent annualized crawl compared with 4.9 percent in the prior quarter, and the economy lost an unexpected 17,000 jobs last month.
The Fed has unleashed more aggressive rate cuts in recent weeks as recession worries have mounted, although some analysts believe the economy is already in recession.
The yield on the 10-year Treasury bond rose to 3.6 percent from 3.584 percent a week earlier, while that on the 30-year bond climbed to 4.318 percent from 4.282 percent.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
US CONSCULTANT: The US Department of Commerce’s Ursula Burns is a rarely seen US government consultant to be put forward to sit on the board, nominated as an independent director Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday nominated 10 candidates for its new board of directors, including Ursula Burns from the US Department of Commerce. It is rare that TSMC has nominated a US government consultant to sit on its board. Burns was nominated as one of seven independent directors. She is vice chair of the department’s Advisory Council on Supply Chain Competitiveness. Burns is to stand for election at TSMC’s annual shareholders’ meeting on June 4 along with the rest of the candidates. TSMC chairman Mark Liu (劉德音) was not on the list after in December last