Daily FNArena News - FYI

The Dow posted a 92 point rally last night as M&A shouldered aside subprime and Merck posted a good result.

The Australian CPI will be out on Wednesday while the RBNZ will make a rate decision on Thursday.

One poor earnings result set off a jittery Wall Street as funds buying returned to gold and China hiked.

Wall Street has decided to like Mr Bernanke’s comments as earnings results again pleased, at least before the bell. Oil, gold and base metals were all strong.

The Dow recovered somewhat from an initial 134 point fall last night as bargain hunters offset inevitable Bear Stearns weakness and disappointment from Mr Bernanke.

Weekly musings from your editor. This week the Aussie dollar, Iluka, the greenback but above all the Japanese yen have caught his attention.

As Bear Stearns’ hedge funds are declared worthless, investment banks are getting stuck with private equity LBO loans and bonds, and Moody’s moves in on higher quality mortgage securities.

Wall Street action was all after the bell this morning as Bear Stearns announced its funds at the centre of the subprime crisis were close to worthless and some poor profit results were posted.

NZ inflation for the June quarter rose 1.0% against expectations of a 0.8% gain so the market is factoring in a July rate hike, but not all analysts agree the RBNZ will again tighten.

There was a broad market decline on Wall Street overnight leaving the Dow to do its own thing on rumours of a bid for telco Verizon.