U.S. stocks and exchange traded funds (ETFs) rallied this morning, extending a global advance on word that accounting regulators approved a rule change that may boost bank profits.
The rally was further supported by the G-20 Summit, where leaders of the global powerhouses neared an agreement on the global recession through tightening rules on financial markets, cracking down on tax havens and channeling more cash to the International Monetary Fund. In fact, the G-20 leaders have decided to pump $1.1 trillion in international aid into the global markets to cushion the global recession’s blow, state Tony Czuczka and Edwin Chen for Bloomberg.
The effects of the recession have been further supported by the rise in consumer loan delinquencies. Mounting job losses have forced the delinquency rates across multiple types of closed-end consumer loans to jump to 3.2%, states the Stephen Bernanrd of the Associated Press. What’s shocking is that these delinquency rates do not take into consideration credit cards, which, for some, is a way of life. If one includes credit card delinquencies, this percentage will absolutely increase.
Many believe that the reason consumer loan delinquencies continue to rise is the increase in jobless claims, and there doesn’t seem to be any relief in this department. New claims for unemployment benefits jumped to a 26-year high and jobless claims increased to a whopping 669,000, last week, the highest jump since 1982, states the Labor Department. Although these numbers are devastating, they seem to have no immediate effect on the markets and their rally.
Crude oil seems to have jumped on the wagon and is riding the wave of the global market rally. A combination of surging markets in Asia and Europe and hopes of an economic recovery in the United States sent black gold north of $5 a barrel in intraday trading. PowerShares DB Oil (DBO), was up 6.8% in intraday trading and 0.1% year to date.
It seems that no amount of bad news can throw the markets off of their high horse. Supplier of herbicides and genetically engineered seeds, Monsanto (MON), increased revenues by 8.3%, but saw a drop in profits by 3.3%. These numbers still beat analysts’ expectations, sending shares of the seed maker’s stock in the green during morning trading, states The Wall Street Journal.
- Market Vectors Agribusiness ETF (MOO): up 3.2% in intraday trading and 4.5% year-to-date; MON is 8.4%
The Dow Jones Industrial Average soared 3.6% sending it north of 8,000 midday, the S&P 500 jumped 3.2% and the Nasdaq gained 3.8% in morning trading.
Kevin Grewal contributed to this article.
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