Bears emerge from cave to flow on Citibank's Gulf stream - Wednesday 28th November 2007
Stocks have staged a rebound today (November 27th) after America's biggest bank, Citigroup, received a much-needed $7.5 billion capital injection from Gulf-based investors.
The Abu Dhabi Investment Authority (ADIA) will bolster the mortgage loss-stricken bank, with the news buoying US markets and sending the Dow Jones industrial average up 163.47 points (1.28 per cent).
Citigroup insisted that the investment was passive – with the ADIA obtaining no rights to influence board member appointments – but despite concerns of the price paid for the injection, a stock market up-turn read the Citigroup news positively.
Hugh Johnson, chief investment officer of Albany's Johnson Illington Advisors, told Reuters: "When you have the market decline as much as it did in the last week or so, it doesn't take much to bring out all the bottom-fishing bargain hunters.
"The Citigroup news is what did it today and at least for one day, investors are putting their bearishness on hold."
The decline in bearishness could be a very temporary one, with news of a two-year low in US consumer confidence leading a host of negative market data that emerged today.
The Abu Dhabi Investment Authority (ADIA) will bolster the mortgage loss-stricken bank, with the news buoying US markets and sending the Dow Jones industrial average up 163.47 points (1.28 per cent).
Citigroup insisted that the investment was passive – with the ADIA obtaining no rights to influence board member appointments – but despite concerns of the price paid for the injection, a stock market up-turn read the Citigroup news positively.
Hugh Johnson, chief investment officer of Albany's Johnson Illington Advisors, told Reuters: "When you have the market decline as much as it did in the last week or so, it doesn't take much to bring out all the bottom-fishing bargain hunters.
"The Citigroup news is what did it today and at least for one day, investors are putting their bearishness on hold."
The decline in bearishness could be a very temporary one, with news of a two-year low in US consumer confidence leading a host of negative market data that emerged today.
Goldbug, 28 Nov '07
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