GM's return sends stocks soaring on Wall Street

The relisting of General Motors sent stocks on Wall Street surging as investors also bet that Ireland would receive a rescue package.

Nearly 430 million GM shares were traded as the US government sold much of its stake. The shares immediately rose above the $US33 issue price and peaked at $US35.99.  They were $US34.07 at the market close (10am NZ time).

The Dow Jones Industrial Average rose 173.35 points, or 1.6%, to 11,181.23, its first gain in three days.

Alcoa led the blue-chip index's gains, jumping 43.7%, while Boeing put on 2.9% and Caterpillar added 2.4%.

The S&P 500 index advanced 1.5% to 1196.68, finding the 1200 level elusive. The materials, energy and industrials sectors led the broad index's gains as worries diminished about China and the scope of its inflation-cooling measures.

The technology-heavy Nasdaq Composite jumped 1.55% to 2514.40.

Other markets: Europe, Asia up
European stocks rose, the euro gained ground and commodity prices advanced as the Irish government looked more likely to accept some sort of bailout.

The Stoxx Europe 600 Index rose 1.1% to 270.37. London's FTSE 100 increased 1.3% to 5766.75, Frankfurt's DAX rose 1.4% to 6792.54 and the French CAC-40 gained 1.6% to 3852.68.

In Asia, Japanese stocks ended at a four-month high as the yen's decline against the euro spurred buying interest.

Chinese and Hong Kong stocks rebounded after Beijing's announced inflation-cooling measures proved less harsh than expected.

Tokyo's Nikkei Stock Average rose 2.1% to 10013.63, its first finish above 10000 since June.

The Shanghai Composite Index rose 0.9% to 2865.45, Hong Kong's Hang Seng Index gained 1.8% to 23,637.39, Sydney's S&P/ASX 200 added 0.3% to 4640.15 and Seoul's Kospi climbed 1.6% to 1927.86.

Commodities: Oil, gold up
Oil prices rebounded after falling just shy of $US80 a barrel on Wednesday, the lowest price in nearly a month.

Light, sweet crude for December delivery recently traded up 82 cents, or 1%, at $81.26 a barrel late morning on the New York Mercantile Exchange. The contract expires at settlement Friday.

Buyers returned to the gold market, shedding the dollar in favor of the precious metal as a bailout package for Ireland's debt appeared imminent.

The most actively traded contract, for December delivery, was up $US14.20, or 1.1%, at $US1,351.00 an ounce in New York. The contract expires at the end of Friday.

Currencies: Euro up, yen down
The euro rose against the dollar as a rescue plan for fiscally strapped Ireland was thought to be imminent.

The dollar recovered some of its earlier losses after the Federal Reserve Bank of Philadelphia said its November index of general business activity came in at 22.5 from 1.0 in October. Economists had expected a reading of 4.5.

The dollar also gained against the yen, rising above ¥83.60 to levels not seen since October 5. The dollar also flirted with parity against the Swiss franc, rising to its strongest level since September 21.

The euro was at $US1.3606 from $US1.3515. The dollar was at ¥83.64 from ¥83.33, while the euro was at ¥113.81 from ¥112.59.

The UK pound was at $US1.6001 from $US1.5895. The dollar was at 0.9970 Swiss franc from 0.9928 franc. It ticked as high as 0.9999 franc.

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3 Comments & Questions

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For the US taxpayer to break even, the Government will have to sell the rest of their shares for over US$50. Currently they're selling at $35: and that's a success?Then take away the stimulus and see how many cars are selling. The opening share price simply shows the value that has been destroyed.

Worse, the US stock market is currently yet another bubble created by stimulunacy: I wonder if these investors realise just how high the risk is they buying into to?

Interesting times.

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check back in 10 or 20 years and chances are Citigroup and GM will be broke again.

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And no mention that a kiwi turned GM around in a global recession in what is most likely the most challenging industry.

Mind you, back here in NZ we have brilliant minds like David Hillary who can predict market events 20 years out. I must have gone to the wrong school.

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NZ Market Snapshot

Forex

Sym Price Change
USD 0.7845 0.0017 0.22%
AUD 0.8994 0.0002 0.02%
EUR 0.6203 0.0010 0.16%
GBP 0.4929 0.0003 0.06%
HKD 6.0847 0.0131 0.22%
JPY 84.0120 0.0180 0.02%

Commods

Commodity Price Change Time
Gold Index 1233.8 -1.760 2014-10-14T00:
Oil Brent 85.4 -4.470 2014-10-14T00:
Oil Nymex 81.2 -4.530 2014-10-14T00:
Silver Index 17.4 0.035 2014-10-14T00:

Indices

Symbol Open High Last %
NZX 50 5145.9 5168.7 5145.9 0.33%
NASDAQ 4246.2 4281.3 4213.6 0.32%
DAX 8765.4 8854.4 8812.4 0.15%
DJI 16321.9 16463.7 16321.1 -0.04%
FTSE 6366.2 6403.4 6366.2 0.42%
HKSE 23087.5 23230.3 23048.0 0.67%
NI225 15009.8 15044.3 14936.5 -0.13%