While you were sleeping: BusinessWire weekend wrap

Monday 8th September 2008

Wall Street edged higher as hope for fresh capital for Lehman Brothers and a rescue effort for Fannie Mae and Freddie Mac helped financials rebound after the market first dropped on news of a grim US jobs report for August.

The S&P 500 added 5.48 points, or 0.4%, to 1,242.31. The Dow rose 32.73, or 0.3%, to 11,220.96. The Nasdaq Composite Index slipped 3.16 to 2,255.88. About six stocks rose for every five that fell on the New York Stock Exchange.

Reuters reported that Lehman might have attracted asset buyers in Blackstone and Kohlberg, Kravis Roberts. After the bell, The Wall Street Journal reported the US Treasury was close to finalising a plan to backstop mortgage finance companies Fannie Mae and Freddie.

The Treasury plan was subsequently confirmed as the U.S. government seized control of the mortgage lending financiers. The Federal Housing Finance Agency will take over Fannie and Freddie under a so-called conservatorship, replacing their chief executives and eliminating their dividends.

The Nasdaq lagged the other indexes on Friday and had its worst week since January, led lower by big-cap technology shares. Qualcomm shares fell 1.8% to US$47.67, while Apple declined 0.7% to US$160.18.

SanDisk jumped 31.1% to US$17.64 after Samsung Electronics Co, the world's top maker of memory chips, said it might buy the flash memory maker in a deal that could reshape a struggling industry.

Lehman rose for the seventh time in eight trading session, adding 6.8% to US$16.20. Bank of America gained 5.3% to $US32.23. Citigroup added 4.2% to US$19.07. JPMorgan increased 4.5% to US$39.60.

The gain in banks came even as foreclosures rose above 1% in the second-quarter for the first time since the Mortgage Bankers Association began its loan survey almost three decades ago.

Dollar strengthens

The US dollar edged higher versus the euro on Friday but retreated from 11-month highs after government data showed the US economy lost jobs for the eighth straight month and the unemployment rate jumped.

The euro was slightly lower at US$1.4235 in late trading on Friday. The euro earlier hit an 11-month low at US$1.4197, according to Reuters data.

The ICE Futures US dollar index, which tracks the value of the greenback against a basket of six currencies, was also slightly higher at 78.930, after seeing a new 12-month high on Thursday.

The yield on the benchmark 10-year note rose 7 basis points to 3.69% at 5:12pm in New York on Friday, according to bond broker BGCantor Market Data.

Oil prices fell to a fresh five-month low on Friday on flagging demand in the United States and other consumer nations, extending crude's losses to 8% this week.

US crude traded down US$1.66 to settle at US$106.23 a barrel, the lowest level since April 4. London Brent crude fell US$2.21 to US$104.09.

Copper tumbled, capping the biggest weekly drop since January 2007, as climbing stockpiles and slowing global growth signaled demand for the metal may decline.

Inventories monitored by the London Metal Exchange surged 10% today to 200,875 metric tons, the highest since January 8 and the biggest one-day jump since August 2005.

The US unemployment rate rose to a five-year high last month, the government reported. Copper has dropped 27% since reaching a record in May.

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