Wall Street gains on government mortgage plan

Wall Street saw gains in late afternoon trade on Thursday. The Dow Jones Industrial Average added 1.13 percent to 13,596.24 while the Nasdaq Composite was up 1.3 percent to 2,700.96 and the S&P 500 gained 1.21 percent to 1,502.97. The gains came after the government announced a plan to help some homeowners touched by the subprime mortgage crisis as well as on increased hopes that the Federal Reserve will cut interest rates when it meets next week. Some mortgage lenders were helped to gains after US President George W. Bush announced the plan to freeze the interest rates on some mortgages and help those homeowners to refinance their loans. Retailers saw declines amid news that consumers are not spending much money as home prices fall and oil prices go up.

Equities markets in the Asia-Pacific region were mixed after new data on jobs and productivity made it look less likely that the US economy is headed for recession. Most indices saw gains. The Taiex added 0.2 percent to 8,694.41 in Taiwan. In India the Sensex gained 0.29 percent to 19,795.87 while Hong Kong’s Hang Seng index was up 0.73 percent to 29,558.92. The Kospi index was 0.77 percent higher to 1,953.17. Meanwhile in Australia, the Sydney Ordinaries added 1.4 percent to 6,660.5 and the S&P/ASX200 gained 1.43 percent to 6,600.9. Among decliners, the Shanghai Composite was down 0.15 percent to 5,035.07 while the Straits Times index dropped 0.21 percent to 3,552.55 in Singapore.

Tokyo’s markets were mixed. While the Nikkei 225 gained 1.7 percent to 15,874.08 and the Topix index added 1.68 percent to 1,552.27, the Mothers market of small and mid-caps dropped 0.53 percent to 911.76. A weakening yen helped the gains as exporters such as automobile manufacturers, the electronics sector and semiconductors manufacturers all saw gains, as did banks. There were declines in the advertising sector, however, on a broker downgrade.

Europe’s equities markets were mixed on the session as well. The pan-European FTSE Eurofirst 300 added 0.08 percent to 1,527.72 and the Paris CAC-40 was up 0.26 percent to 5,673.76, but the Dax was down 0.05 percent to 7,940.58 in Frankfurt and Madrid’s IBEX dropped 0.67 percent to 15,695.9. Utilities, banks and insurers all saw gains, but carmakers and the telecommunications sector were lower on the session.

In London the FTSE 100 dropped 0.13 percent to 6,485.6 and the FTSE 250 fell 0.15 percent to 10,495.8 after the Bank of England cut interest rates in the UK by a quarter point to 5.5 percent. Banks were mixed but mostly higher, while the insurance and oil sectors were also mixed. Most retailers were lower, while house builders and property developers and investors declined after one builder said that reservations were down 7 percent from last year at this time and performance in the spring would dictate full-year results.

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