Bailout hopes lift global stocks (25-02-2008)

The wind of hope that saved U.S. stocks from losses in the last half hour of trading on Friday has been around the globe as most stock markets in both Asia and Europe traded in positive territory. The Dow Jones went from losing about 130 points to close almost 97 up, after unconfirmed talk that a number of banks are arranging a bailout for beleaguered bond insurer Ambac.

Most Asian markets were in positive territory with the exception of Hong Kong and China, where stocks finished lower. Financials were buoyed by the promise of bond insurer bailout, led by Mizuho in Japan and National Australia Bank in Sydney.

 In Europe it was the same story, as financials gained sharply in anticipation of a bailout announcement. Dexia, the owner of U.S. bond insurer FSA, gained 4% in Belgium, while in the U.K. mortgage lenders Bradford & Bingley, up 5%, Alliance & Leicester, rose by 4.8% and Royal Bank of Scotland rose sharply by 5.9% just before it is due to release its results on Thursday.

 By 12:00GMT, U.S. market futures were pointing upwards set to extend their rally on the strength of Friday’s sentiment, but investors were also awaiting the existing home sales reading due out at 13:30 GMT.

. Source Isfm