Small caps up slightly
The Russell 2000 (NYSE: IWM) is just above the flat line as investors react to the latest financial news.
At 10:41 a.m. ET, the small-cap index had added 1.98 points, or 0.26%, to 756.04. The Dow Jones Industrial Average (INDU) was up 55.44 points, or 0.42%, to 13,287.91.
The futures were little changed this morning on news that Morgan Stanley (NYSE: MS) swung to a fourth-quarter loss due to $9.4 billion in mortgage-related write-downs. Quarterly net revenue was a negative $450 million, compared with a positive $7.85 billion a year ago.
The New York-based financial services giant responded by saying that it will sell as much as 9.9% of itself to a Chinese sovereign fund for $5 billion.
The move is similar to the one made by a number of financial heavyweights that posted losses on investments in securities that contain subprime home loans and then turned to foreign investors for a cash infusion to boost capital.
Today’s news once again highlights the wide reach of the contagion from the subprime mortgage crisis and its ability to infect the largest of financial actors. But the bulls will take solace in the fact that cash infusions will allow the wounded companies to continue their operations.
Elsewhere, a report by the Mortgage Bankers Association showed that mortgage applications for the week ended Dec. 14 decreased 19.5% on a seasonally adjusted basis.
The Market Composite Index was 653.8, compared with 811.8 a week earlier. The four week moving average, a more stable measure, is down 1%.
Stagnating home prices and tighter lending standards have made many Americans unwilling or unable to purchase homes, further contributing the slump in the U.S. housing sector. The ailing housing sector is one of the major factors dragging down U.S. economic growth.
At 10:41 a.m. ET, the small-cap index had added 1.98 points, or 0.26%, to 756.04. The Dow Jones Industrial Average (INDU) was up 55.44 points, or 0.42%, to 13,287.91.
The futures were little changed this morning on news that Morgan Stanley (NYSE: MS) swung to a fourth-quarter loss due to $9.4 billion in mortgage-related write-downs. Quarterly net revenue was a negative $450 million, compared with a positive $7.85 billion a year ago.
The New York-based financial services giant responded by saying that it will sell as much as 9.9% of itself to a Chinese sovereign fund for $5 billion.
The move is similar to the one made by a number of financial heavyweights that posted losses on investments in securities that contain subprime home loans and then turned to foreign investors for a cash infusion to boost capital.
Today’s news once again highlights the wide reach of the contagion from the subprime mortgage crisis and its ability to infect the largest of financial actors. But the bulls will take solace in the fact that cash infusions will allow the wounded companies to continue their operations.
Elsewhere, a report by the Mortgage Bankers Association showed that mortgage applications for the week ended Dec. 14 decreased 19.5% on a seasonally adjusted basis.
The Market Composite Index was 653.8, compared with 811.8 a week earlier. The four week moving average, a more stable measure, is down 1%.
Stagnating home prices and tighter lending standards have made many Americans unwilling or unable to purchase homes, further contributing the slump in the U.S. housing sector. The ailing housing sector is one of the major factors dragging down U.S. economic growth.
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