Overnight Markets Stay Positive, U.S. Futures Move Higher

Current Futures: Dow +62.00, S&P +7.40, NASDAQ +6.00
 
European Trade: President Obama revealed the details for a new stimulus plan, one that would address homeowners directly. The President plans to use $75 billion to help up to 9 million homeowners avoid foreclosure, and stay in their homes. Theoretically, every homeowner should receive up to $8,000, in order to bring mortgage rates down. 

Despite what seems positive news, on the surface, it appears the U.S. markets did not fully buy into it yesterday, contrasting the overnight markets. The current administration still faces some rather major issues. One of the problems is that mortgages have been re-packaged and sold throughout the derivatives market two or three times, if not more. Any decision the bank that originated the mortgage makes will have to get the approval of secondary or even tertiary rank holders. It should be noted that, some of those investors shorted the mortgage market, so their approval might come at the cost of their profits.

In Europe, Continental AG posted a 1.12 billion euro loss in 2008, almost three times more than what analysts had expected. The company is one of the largest manufacturers of auto parts, especially tires. The entire auto-industry has posted disappointing results for 2008. The French bank SocGen posted some relative good results in 2008; today BNP Paribas announced a 1.37 billion euros fourth quarter loss. The largest French bank was hurt by both Lehman’s bankruptcy and Madoff’s Ponzi scheme, but expects to become profitable as early as the first quarter.

Tonight, the Nikkei gained 23.31 points (0.31%) to 7,557.65 The Australian S&P rose 35.70 points (1.05%) to 3,448.90. The U.K. Ftse rose 5.58 points (0.14%) to 4,012.41, while the German Dax gained 15.13 points (0.36%) to 4,220.09.

Crude oil continues to decline, in-line with the demand side. Crude oil for March delivery fell $0.10 to $34.60

Gold declined tonight, after posting strong gains in the last two days. Bullion for immediate delivery slipped $2.60 to $975.60.