Another $250 Billion Injection for the USA

The US Futures market has again indicated in early trading that Tuesday is going to be another bumper day for the Dow Jones Industrial Average (DJI) with news just in, that the US Government is going to inject another $250 Billion into the countries largest banks – to follow the lead set by the UK and Europe.

While the Dow was up very strongly on Monday and stocks such as General Motors (GM) shot up 30% after merger talks, attention will turn to whether the market can sustain such improvement. The US Government is expected to announce capital injections into Citigroup (C), J.P. Morgan Chase (JPM) and Bank of America (BAC) in order to ensure that markets remain liquid and stable.

In my opinion, Wall Street needs to take a step back and really focus on it’s countries fundamentals and ensure that these massive swings are stabilised. Intense focus needs to be on fiscal and monetary policy to ensure that the financial implications of all these capital injections is actually positive for the US economy. 

Of note, Crude oil is still trading  above the $80 a barrel mark improving on the back of Monday’s stella market performance. Light sweet crude rose again to $80.28, up another $2.58 on the session. Of particular note, Oil actually hit a high of $82.52 in electronic trading before settling down to a lower level.