US stocks reach two-month high after disastrous 2008

January 3rd, 2009 - 8:14 am ICT by IANS  

New York, Jan 3 (DPA) US stocks reached a two-month high Friday, the first day of trading in 2009, buoyed by news that General Motors had received its first money lifeline from the US government.With Wall Street’s three major indices adding 2.94 to 3.5 percent, the news took some of the sting out of the end-of-2008 headlines Wednesday, which dismally blared the market’s worst annual drop since the Great Depression. The Dow Jones Industrial Average alone shed 34 percent over the year.

GM, the largest US automaker, rallied 14 percent Friday after the US government moved during the New Year’s holiday to free up more money for auto loans and to start the emergency infusion of billions of dollars directly into the industry to keep it afloat.

While Chrysler LLC was still waiting for its money Friday, General Motors has received $4 billion of the $13.4-billionlifeline promised by US George W. Bush late in December, Bloomberg financial news service reported.

Meanwhile, the US Treasury this week released guidelines for how it could help other parts of the auto industry, the Detroit Free Press reported.

Monday, the US Treasury Department started moving to free up auto loans by committing 6 billion dollars to supporting GMAC LLC, the financing arm of General Motors Corp.

Energy stocks also rose on per-barrel oil price increases.

The blue-chip Dow Jones Industrial Average gained 258.30 points, or 2.94 percent, to 9,034.69. The broader Standard & Poor’s 500 Index jumped 28.55 points, or 3.16 percent, to 931.80. The technology heavy Nasdaq Composite Index increased 55.18 points, or 3.5 percent, to 1,632.21.

European markets also showed hefty investor interest, with London’s FTSE 100 up 2.88 percent, France’s CAC 40 up 4.09 percent and Germany’s DAX up 3.39 percent.

The US currency gained against the euro to 71.83 euro cents from 71.63 euro cents Wednesday. The dollar also increased against the Japanese currency to 91.84 yen from 90.67 yen.

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