Financial Report – Friday 16th January 2008

Any of the more optimistic investors around who stayed with their HSBC shares for another day thinking that things couldn’t get any worse, discovered that they could with their groups shares toppling another seven per cent (41.25p, to 547.5p )

This share price fall appeared to spur gains for the Standard Chartered bank group whose presence in the Asian banking market appears to provide a more stable setting for investors, at least for the time being. This confidence was reflected by a rise in shares for the group of 2.8 percent.

( 21p, to 766.5p)

The remaining bans shares all continued their seemingly never ending downward climb with Lloyds TSB, down 11.7 per cent, (13.7p, at 103.5p,) Barclays, down 8.2 per cent, (11.7p, at 130.4p), and Royal Bank of Scotland, falling 4.3 per cent, (1.8p, at 39.9p.)

Overall, the market continued its losing streak, with the FTSE 100 falling to 4,121.11, down 59.53 points, and the FTSE 250 losing 158.62 points to 6,204.97.

Property issues were also hit by fears of a possible move to raise capital by the Hammerson group, causing their shares to fall by five percent (24.5p to 469.5p) which retreated to 469.5p, down 5.0 per cent or 24.5p. Hammerson, property portfolio includes some major shopping centers in London and Birmingham.

Cautious optimism was recorded in the mining sector also recovered from recent losses, with Xstrata 1.7 per cent (12.00p to 700.00p). This revaluation was brought about by news that the company were planning to resume mining their McArthur River zinc mine in Australia.

The FTSE 100 Index closed down 59.5 points at 4121.1. with the 250 actually showing a rise of 89.06points to 6294.03 (+1.44%)

Wall Street got a small dose of good news Thursday with JPMorgan Chase & Co. reporting improved fourth-quarter earnings. JPMorgan is the first big U.S. bank to release fourth-quarter earnings, and analysts and investors believe the report could signal how the rest of the industry is faring. The feeling on the street had been that JPMorgan, who acquired the Bear Stearns Cos. and Washington Mutual Inc. last year, has been doing better than most of its peers.

However, optimism was tinged when new reports suggesting that Bank of America might be in need of a government- sponsored capital injection and reports of Citigroup suffering sharp falls before its quarterly results began to filter through.

Overall the Dow Jones industrial average futures rose 6, or 0.07 percent, to 8,165. while Nasdaq 100 index futures fell 19.75, or 1.69 percent, to 1,145.75.

The enthusiasm that began to raise its head late 2008 has been steadily reduced as 2009 begins to open up. The increasingly gloomy outlooks for companies ranging from banks to retailers to energy producers is taking its toll, evidenced by the fact that the Dow has now fallen for six straight sessions.

Sterling was mixed against other major currencies early Friday with rates as follows:

pound/US dollar 1.49254
pound/Euro 1.12801

pound/Japanese Yen 134.823

Gold prices rose as well as light, sweet crude oil that rose 45 cents to $37.73 a barrel in electronic premarket trading on the New York Mercantile Exchange.

In Asia, Japan’s Nikkei stock average dropped 4.92 percent and Hong Kong’s Hang Seng index tumbled 3.37 percent..

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Tags: Bank, Bank of England, Banking, British Economy, British Pound, Credit Crunch, Debt, Finance, Financial News, FTSE, Money Markets, Recession, UK Banks, UK Recession