Page last updated at 21:54 GMT, Monday, 23 March 2009

Wall Street soars on bailout plan

Traders on the New York stock exchange
At long last, cheerful news on Wall Street

Wall Street shares have soared after the US government announced another bailout plan for troubled banks.

All key stock indices gained around 7%, with the Dow Jones index jumping nearly 500 points to close at 7,775 - its highest level in more than a month.

The wider S&P 500 index was the biggest gainer, up 7.1% to close at 822.92.

Bank stocks were the biggest winners, with Bank of America up 26%, JP Morgan Chase jumping 25% and Citigroup ending the day with a 19.5% gain.

Probably the days' biggest winner was Nasdaq-listed Frontier Financial Corporation, a regional bank serving the Northwest of the United States, which posted a gain of 52% - albeit from a very low level.

Investors took cheer not only from the US Treasury's plan to kick-start the financial sector by buying up to $1 trillion (£688bn) worth of difficult-to-value toxic assets.

A surprise jump in the number of homes sold also raised hopes that the country's battered housing market could be starting to recover.

Several leading pension fund managers said they were keen to participate in the Treasury's plan, which hopes to combine government money with private investments to get troubled mortgages and securities off the banks' balance sheets.

On the downside for consumers, the market rally also helped to support a 3% rise in oil prices, with a barrel of US light crude oil trading at $53.8 - up $1.73.

Earlier in the day, European stock markets had also posted gains, with leading stock indexes in London, Frankfurt and Paris gaining around 2.8%.

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FTSE 100
23.70 0.44%
19.54 0.34%
Cac 40
14.48 0.38%
Dow Jones
78.53 0.76%
35.31 1.58%
BBC Global 30
20.65 0.36%
Data delayed by at least 15 minutes

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