More positive news indicating that the global recession may be nearing a bottom came out of the Organization for Economic Cooperation and Development (OECD) stating that it expects the economies of its members to decline by 4.1% for the year, as opposed to its previous forecast of a decline of 4.3%. Additionally, the organization expects overall growth across its membership expected to average 0.7% in 2010, which is up from its previous forecast of 0.1% growth.
Lending has loosened up across the pond as the European Central Bank reported that it will lend banks a whopping $621 billion for 12 months, the most it has ever allotted in an auction, states Gabi Thesing of Bloomberg. All the loans will be lent out at the current benchmark rate of 1% and will get to the banks as soon as tomorrow. This massive lending spree should lubricate a much-battered European banking system, which accounts for nearly 75% of company financing in the region. The news helped lift the iShares S&P Global Financials (IXG) up nearly 3% in morning trading.
Overall, all three major U.S. indexes were in positive territory this morning, with the Dow Jones Industrial Average up 0.9%, the S&P 500 up about 1.4% and the Nasdaq up nearly 2.1%.
Kevin Grewal contributed to this article.