Markets Rally On Geithner Nomination For Treasury

While it is not official, the financial press is reporting that President-Elect Barack Obama will be tapping New York Federal Reserve Bank President Tim Geithner as the new Secretary of the Treasury. Geithner was a U.S. Treasury Department official under both Robert Rubin and Lawrence Summers and has been with Treasury since 1988. He has also worked closely with Secretary Paulson on managing the economic bail out.

The Wall Street Journal also reported that Mr. Obama plans to introduce his entire economic team on November 23 in an effort to sooth financial markets and answer rising pressure on the president-elect to become more involved.

At the close of floor trading on the NYSE, the DOW was on 8046.66 after gaining 494.37 points (6.55%), making a 500+ point turn around off the low. The S&P closed on 600.01, up 47.57 points (6.32%) while the NASDAQ finished the day's trading on 1384.35 with a gain of 68.23 points (5.18%). Bonds were sold as stocks were bought, with yield on the 2-year note gaining 13.1 basis points to 1.086% while yield on the 10-year note gained 18.5 basis points to 3.192%, after falling below 3.11% for the first time ever on Thursday. The dollar traded in risk-acceptance mode, with losses of 0.96% on the euro, 0.99% on the pound and 3.11% on Australia's dollar while it gained 2.35% against the yen.

NYMEX crude for December delivery closed up $1.14 (2.31%) to $50.56 per barrel.

COMEX gold closed up $45.60 (6.09%) to $794.30 per ounce.

"There had been some criticism of Mr. Obama for not moving quickly enough in naming a treasury secretary," said Matthew Carniol, chief currency strategist at TheLFB-forex.com. "Aside from the fact that Mr. Geithner is an excellent choice, markets may take a measure of comfort as the President-Elect announces is economic team either over the weekend or on Monday before markets open."

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