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STOCKS: Wall Street closed lower Wednesday, sacrificing the advance it made after the Federal Reserve cut interest rates half a percentage point. Investors collected profits after nearly three sessions of big gains, unwilling to leave money on the table amid ongoing economic uncertainty. The Federal Reserve lowered the fed funds rate, or the interest banks pay one another for overnight loans, to 3 pct, the lowest level since spring 2005. It also lowered the discount rate, or the interest the Fed charges on loans to banks, by a half-point to 3.50 pct. FOREX: The dollar slid lower Wednesday after the Federal Reserve made an expected half-point cut in the federal funds rate and signalled that more moves lower could be forthcoming. BONDS: Treasurys reversed losses in after-hours trading Wednesday as the stock market gave back a big advance prompted by the Federal Reserve's widely expected interest rate cut.
Market Turmoil Felt in Central Europe
It's a phenomenon taking place throughout the world given the market tumult, but one felt acutely in eastern Europe, where retail investors are suffering jolting losses amid the global market dive fueled by the U.S. subprime mortgage crisis and fears of a recession there.
The recent downturn is the sharpest since the dot-com bubble burst in 2000, meaning this is the first real battering for most investors in the region, given that the number of people with mutual fund and stock holdings was still minuscule during the last shakeout.
And they are selling in droves.
On Wednesday, the WIG-20, the Warsaw Stock Exchange's blue-chip index, was down 23.5 percent from its peak on Oct. 29 -- a fall more dramatic than that of the Standard & Poor's 500, which is down 14 percent from its peak during the same weak of October.
Icahn Is Crazy for Snubbing Oracle
Let me get this straight. A bidding war for BEA Systems (Nasdaq: BEAS) is nigh because Carl Icahn thinks Oracle's (Nasdaq: ORCL) $6.7 billion proposal for the company is too low? That may be about the dumbest thing I've ever heard. Glory days will pass you byYes, I'm an Oracle shareholder. But I'm as amused as anyone else when CEO Larry Ellison dismisses software as a service as a here-today-gone-tomorrow fad. Every serious claim from Ellison and his team is to be taken with a giant boulder of salt. Yet when Oracle President Charles Phillips recently told investors that BEA had "become less relevant," he had facts on his side. Researcher IDC pegs IBM (NYSE: IBM) as the world leader in "middleware," so called for how the stuff is used to connect systems that wouldn't otherwise talk to each other.
FIIs pull out over Rs 5,300 cr in 6 days
Foreign Institutional Investors have pulled out over 5,307 crore from the stock market in the last six days, amid the Bombay Stock Exchange's benchmark index Sensex's continuous downward journey during the period. According to the provisional data available on the SEBI website, FII today made a net sale of equities worth Rs 1,356 crore, for the third consecutive trading day today. Analysts believe the concerns in the global markets are behind the FII selling spree of equities in Indian market. The Sensex has lost 3,222.1 points in last six trading sessions, while FIIs have invested Rs 513.90 crore in three instances and pulled out Rs 5,821.70 crore in the other three days, resulting in a net sale of Rs 5,307.80 crore. FIIs had sold shares worth over Rs 2,186 crore on January 18 along with the Sensex dropping 687 points on Friday last week.
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