Credit Concerns Return on Wall Street (10-01-2008)

Wall Street ended on a high note on Thursday, rising sharply after a volatile session, as investors went hunting for bargains; banks and technology stocks led gains with the latter helping the NASDAQ end in positive territory for the first time in nine days; fears of recession persist, however.

In the Asia Pacific region, stocks headed south today with the exception of China and India. Throughout the region it was mostly property and developer stocks that suffered the most, although in Japan financials were also battered, with most of the 85 listed instruments ending in negative territory with Mitsubishi UFJ down by 2.2%, Nagano Bank losing 4.07%, Mizuho Financials retreating by 2.65%, while Sumitomo advanced only fractionally, by 0.26.

In Europe the day was saved in the morning session by the strong quarterly report by British retailer J Sainsbury but reversed as soon as the interest rate decision was released by the Bank of England. The key interest rate remains at 5.5% for now.

On the other side of the Atlantic futures turned down as credit concerns have returned as Capital One Financials issues warning and while Ben Bernanke’s speech focusing on financials is awaited. Some Wall Street economists believe that the nation’s economy is already in recession and are calling for bigger rate cuts from the Fed.