NEW YORK |
NEW YORK (Reuters) - Wall Street stocks rose and the euro strengthened against the U.S. dollar on Thursday after Reuters reported major central banks are ready to coordinate moves to keep markets operating smoothly by providing liquidity in case of turmoil following Sunday's elections in Greece.
Markets have been volatile this week as investors struggled for insights on the likely outcome of the pivotal vote that could determine whether Greece stays in the euro zone.
Central bankers stand ready to act to prevent a credit squeeze if market strains emerge after an unusual confluence of three elections this weekend, with important polls in France and Egypt as well.
U.S. stocks closed just off the session highs hit after the report while the euro extended gains against the greenback.
With the backdrop of coordinated action from central banks, "any reaction to what Wall Street would consider to be an adverse vote (in Greece) would be over fairly quickly," said John Manley, chief equity strategist at Wells Fargo Funds Management in New York.
Manley, however, said rising yields in Spain and Italy will still keep markets under pressure. "I can't imagine it as the start of the big move up because there are still many issues out there."
Spain's 10-year yield was near 6.96 percent after it briefly topped the 7.0 percent mark, the level at which other highly indebted euro zone nations were forced to seek bailouts. Italian yields also rose as investors worried that Spain's financial problems would contaminate Italy as well.
Adding to the market bullishness, Britain and the Bank of England will flood banks with cheap long-term funding to encourage lending to businesses and consumers, and the British central bank will activate an emergency liquidity tool, the Bank governor Mervyn King said in an annual speech to London financiers.
The Dow Jones industrial average gained 155.53 points, or 1.24 percent, to 12,651.91. The Standard & Poor's 500 Index gained 14.22 points, or 1.08 percent, to 1,329.10. The Nasdaq Composite Index gained 17.72 points, or 0.63 percent, to 2,836.33. The MSCI world equity index added 0.35 percent.
The U.S. benchmark 10-year Treasury note was down 12/32 in price, while the yield rose to 1.6386 percent.
Greek banking stocks jumped more than 23 percent amid market talk that secret opinion polls showed a bailout-friendly government was likely to emerge after the election. Greek law forbids the publication of opinion polls in the two weeks ahead of a vote.
U.S. oil futures jumped 2 percent, extending the rally late on the report about central banks' preparedness. Oil rose earlier after the Organization of the Petroleum Exporting Countries agreed to keep its collective oil output ceiling unchanged.
(Reporting by Rodrigo Campos, Editing by Gary Crosse)
Taking on the Goliaths in business - Financial Times
It is a common misunderstanding, usually among those not in business themselves, that business people are generally cut from the same cloth.
The contrast in outlook is often starkest, however, when comparing individuals who run companies because they have climbed the corporate ladder and those who are in charge because they set the thing up themselves.
A classic illustration of this can be found at the beginning of Welcome to Entrepreneur Country, a passionate call to arms penned by serial entrepreneur and first-time author Julie Meyer.
The scene was a planning meeting for a prestigious business awards programme Ms Meyer had been invited to join in order to create an entrepreneurship award.
Putting the case for the importance of ambitious founders, she quoted a research paper from the National Endowment for Science Technology and the Arts. Its key finding was the claim that the 6 per cent of companies defined as “high growth” enterprises had created 54 per cent of the UK’s new jobs.
The problem was that many of the other business heads around the table refused to believe the research. One of them, a chairman of a UK plc, dismissed the findings as “categorically untrue”, Ms Meyer recalls.
Welcome to Entrepreneur Country is Ms Meyer’s attempt to set the record straight about the importance of start-ups and her vision for how the UK, where she has been based for the last 14 years, is becoming a more entrepreneurial place.
She not only believes that the time is right for this individual capitalism to push the country into a new era of prosperity but believes that the skills required to succeed in this will benefit those with feminine skills, such as collaboration, listening and building trust, most. This is unlikely to be music to the ears of those male-dominated boards of FTSE 250 companies.
Californian-born Ms Meyer grew up surrounded by entrepreneurs in Silicon Valley, but only became a founder herself after moving to Paris and completing an MBA at Insead. She made her first £1m from the sale of the networking group First Tuesday, which she launched during the heady days of the 1990s dotcom boom.
She has become a cheerleader for European, and especially British, founders and used a large chunk of the wealth generated from First Tuesday to set up venture capital firm Ariadne Capital with the aim of encouraging successful entrepreneurs to back other entrepreneurs. She has raised her media profile in recent years as a newspaper columnist, regular talking head on readio and television, and an investor on the BBC’s Online Dragons’ Den. The book is named after a website created by Ms Meyer for like-minded founders.
Her message for those corporate chiefs who run large companies created by other people is to recognise that the business world is changing in favour of entrepreneurs and use their financial might to support those promising start ups that are creating the jobs and wealth, or adapt their own business model to become more dynamic. Young start-ups in turn need to see the potential for working with rather than just competing against these large established corporations.
The book is part autobiographical, containing a lot of detail about Ms Meyer’s personal journey.
There are also a lot of bullet points in which Meyer attempts to pass on some of the pearls of wisdom she has gained from her years spent building companies and backing others. There are the inevitable clichés, such as “play to your strengths” as well as some seemingly more insightful ideas, such as letting the money to help your business find you rather than endlessly chasing it yourself.
Ms Meyer likes her metaphors, in particular the David and Goliath battle between small disruptive businesses and the large established companies that refuse to embrace change. These become somewhat stretched by the end of the book and occasionally mixed. You sort of know what she means when she says, “David can be a Trojan horse inside Goliath”, but it still sounds painful.
Ms Meyer’s enthusiasm about her subject is infectious, but her writing style sometimes makes it difficult to follow or agree with her points.
The biggest problem for Ms Meyer may well be in making her case to those “Goliaths” who have not set up on their own, or have been working their way up through someone else’s company, and therefore do not see the world in the same way as her.
Jonathan Moules
The writer is the FT’s enterprise editor
US STOCKS-Wall St rises on news central banks primed to act - Reuters UK
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