4:30PM New York, 10:30PM Frankfurt, 6:30AM Sydney[R]– The Federal Reserve extended another loan facility of $800 billion to mortgage and asset backer loans in what appears to be another fire fighting action. The Fed is quickly running out of options and recent liquidity moves and guarantees are likely to lift long term inflation average in the near future.[/R]

Global Markets

The Federal Reserve extended up to $800 billion of loan facilities to the mortgage and asset based backed loans market. The Fed is quickly running out of alternatives and is now deeply engaged in buying riskier loans and appears to take risk that most banks failed to manage in a prudent manner.

U.S. stocks edged higher after the Fed committed to extend nearly $800 billion in loans to asset backed loans and mortgage backed loans. The third quarter U.S. GDP was revised downward to a shrink of 0.5% from the previous estimate of 0.3% decline from the second quarter. The current dollar GDP was estimated in the third quarter at $14.42 trillion an increase of 3.6%

Office rents in Mid-town Manhattan, Tokyo financial district and London West End fell for the first time in seven years.

Stocks in Tokyo rallied tracking the gains in the U.S. following the Friday holiday. Banks gained after the U.S. extended second rescue package to Citigroup. The Bank of Japan lowered its domestic economy assessment. Panasonic is likely to pay $5.2 billion for a majority stake in Sanyo Electric.

Stocks in Hong Kong surged on the second rescue package for Citigroup. World Bank lowered its annual economic growth target for China to 7.5%. China is considering investing as much as 10% of total market capitalization in local markets.

Stocks in Australia soared 6% after metals and oil prices rallied. The second rescue package for Citigroup lifted the mood in trading and China plan to invest directly in the local stocks lifted trading sentiment. Qantas plans to cut its capacity and said it hedged fuel for 2009 at $106 a barrel.

North American Markets

Dow Jones Industrial Average increased 36.08 or 0.4% to a close of 8,479.47, S&P 500 Index increased 5.58 or 0.7% to 857.39, and Nasdaq Composite Index declined 7.29 or 0.5% to close at 1,464.73. In Toronto, TSX Composite Index gained 1.99 or 0.02% to 8,442.86.

Of the 30 stocks in Dow Jones Industrial Average 16 closed higher and 14 closed lower.

Hewlett Packard led decliners in the Dow with a fall of 5.9% followed by losses in United Tech Corp of 4%, in Microsoft Corp of 3.4%, in Intel Corp of 3.2%, in Procter & Gamble of 2.3% and in Boeing Company of 1.4%.

JP Morgan Chase led the gainers in the Dow with a rise of 8% followed by increase in Alcoa Inc of 6%, in Home Depot of 3.8%, in Wal-Mart Stores 3.6%, in General Electric of 3.4%, in Chevron Corp of 3%.

Of the stocks in S&P 500 index, 294 increased, 203 decreased and 3 were unchanged. Of the index stocks, 135 rose more than 3%, 57 fell more than 3% and 20 surged above 10%.

E*Trade Financial led the gainers in the S&P 500 index with a surge of 50% followed by gains in Lincoln National Corp of 44%, in DR Horton of 38%, in Lennar Corp of 31%, SLM Corp of 22%, in CIT Group Inc of 21%, in MBIA Inc of 18% and in Prologis of 16%.

Genworth Financial led decliners in the S&P 500 index with a fall of 23.5% followed by losses in American Capital of 11.7%, in CB Richard Ellis of 11.2%, in Altera Corp of 8.50%, in Electronic Arts of 8.3% and in Bank of New York Mellon of 7.8%.

South American Markets Indexes

Brazil led gainers in the South American region with a rise of 1.8% followed by increases in Colombia of 0.8% and in Argentina of 0.5%.

Peru led decliners in the region with a loss of 2.6% followed by losses in Mexico of 1.2%, in Chile of 0.2% and Venezuela was unchanged.

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