19th August 2011
The website reports the fact that "On Wednesday an unnamed bank tapped the European Central Bank's emergency lending facility for $500 million (£303 million). This was the first time the window has been used in over a year."
FT.com reports on the banking story in more detail with some investors concerned about Switzerland.
"Worries that the eurozone debt crisis could infect the financial system hit the short-term funding markets, forcing some European banks to pay higher rates for US dollar loans. Switzerland's two largest banks, Credit Suisse and UBS, both denied they had made use of the Federal Reserve's swap facility via the Swiss National Bank. There had been speculation that a Swiss bank had accessed the U.S. liquidity facility via a $200 million repurchase transaction with the SNB the previous week."
Here Market Watch is looking at the futures on US stocks but the news is not good with the Dow Jones futures market down by 160 points to 10,857.
It quotes ProSpreads managing director Simon Brown saying:"I can't see where the positive news comes from" in the near term, leaving the way open for further selling But typically low August trading volume has exacerbated market moves in both directions which could make for heightened volatility through the remainder of the month."
Still with Market Watch, columnist Mark Hubert is not sure we are at the bottom of the market. He thinks it could be weeks away.
"One gets the distinct impression that there are a not insignificant number of advisers out there eager to jump back into the market at the slightest excuse. This is not reminiscent of the thoroughgoing pessimism and despair that you often see at tradeable bottoms.
"If I had to pick one historical parallel to what we're in the midst of now, I am increasingly inclined to pick the period after the Oct. 19, 1987, stock market crash. The closing low of that year's Fall correction, as it turned out, didn't come until early December, six weeks later."
And the mood in markets worldwide wasn't lightened by the European Central Bank's chief economist coming out against Eurobonds as the Economic Times reports here.
Juergen Stark said joint eurozone bonds would represent "a transfer of creditworthiness from stable, solid countries to states that have less solid state finances" and he is opposed.
On FT Alphaville the bailout arguments continue. The Finns are now worried that the Greeks will not provide promised collateral in exchange for its bailout funds.
But it is today's FT's FT Lex column that probably best sums up the investor's dilemma in the midst of such stock market carnage.
"The terror of adulthood is having to make your own choices without knowing how they'll work out. Similarly, investors would love to know if the return of market mayhem on Thursday should be dismissed or if it is a portent of things to come. Unfortunately, for all the plunging equities and bond yields, it is still too early to say." Quite.
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