Financial Market Update: After the Closing Bell-Tues., Oct. 14

Was Monday’s upward rush of stock prices an example of a dead-cat bounce (a really big dead cat, maybe a puma bounce)? Hard to tell after today’s performance. The Dow Jones Industrial Average lost ground, but not much: 76 points, or a scant 0.82 percent. The Standard & Poor’s 500 fell 0.53 percent, and the Nasdaq lost somewhat more as a percentage–3.54 percent–but then again tech stocks seem to have issues not directly related to the credit meltdown, such as anxiously waiting for Intel Corp. to report its profits (which after the bell turned out to be 12 percent up). Perhaps investors are tired of the roller coaster, for now. Or not. Tomorrow’s another day, and investors are an easily spooked herd. The Dow was famously up yesterday by a fairly dramatic number, but what of other important–arguably more important–numbers, such as LIBOR (the London Interbank Overnight Rate)? According to Bloomberg data, last Thursday it was 5.09 percent. On Friday, 2.47 percent; and this morning, it had edged down at 2.18 percent, roughly where it was before the September panic started. The three-month LIBOR is still fairly high at 4.64 percent, compared with 2.82 percent in mid-September. Worldwide, equity markets made considerable gains yesterday. Japan’s Nikkei 225 shot up more than 13 percent; the German DAX closed up 11 percent, a record; and the British FTSE 100 gained 8.3 percent. Today, these same indexes have been going up more. So there seems to be good vibes all around. For now. With one exception: Iceland. According to the U.K. newspaper the Telegraph, the benchmark ICEX index dropped 2,287.78 points to 716.84 on Monday, the first day of trading after it was suspending last week. What now for Iceland?The Bank of Japan has announced that it will offer lenders dollars at fixed rates for an “unlimited amount against pooled collateral.” The move came only a day after the European Central Bank, the Bank of England and the Swiss National Bank made similar moves. IndyMac, WaMu, Wachovia. And now Sovereign Bancorp Inc. joins the lineup of Vanished Banks of 2008. The company has agreed to be bought by Spain’s Banco Santander, noting that customers withdrew about $4.2 billion recently, mostly in September–which seems to have been a critical factor in the sale, along with a third-quarter net loss of $982 million. Santander is buying Sovereign in a stock swap valued at about $3.81 a share, a little more than it currently trades for. The company’s stock lost about 76 percent of its value since this time last year.