REFILE-GLOBAL MARKETS-Stocks rally on crisis plan, bonds fall
September 19th, 2008 | by admin |* Stocks soar in late rally on hope crisis resolution near
* Bonds fall as safe-haven bid ends on crisis plan news
* Oil also rises on plan, impact of hurricanes
* Dollar rises, then eases on crisis resolution plan (Fixes headline to show that bonds fell. No changes in text)
By Herbert Lash
NEW YORK, Sept 18 (Reuters) - U.S. stocks had their bestday in six years on Thursday on news of a U.S. Treasury plan toresolve a credit crisis that has rocked financial markets allweek, which erased an earlier safe-haven bid for gold and U.S.government debt.
The late-stage rally, which sent the Dow up more than 400points and the Nasdaq and benchmark S&P 500 up more than 4percent, capped a day of whip-saw trade in global markets.
Initial enthusiasm over a move by the world’s leadingcentral banks to thaw the credit crunch with an injection of$180 billion initially sent stock markets up, only to turnnegative as fears of financial contagion — including questionsabout the future of investment banks Morgan Stanley and GoldmanSachs — spread through markets.
News that U.S. Treasury Secretary Henry Paulson has spokenwith Congressional lawmakers about a plan to deal with bad debtsimilar to the creation of the Resolution Trust Corporation in1989 that resolved the U.S. savings and loan crisis spurred thelate rally.
