CLOSING MARKET REPORT
Lehman buyout talk, oil, GM lift Wall Street

NEW YORK - US stocks rose on Thursday as a report that major US investment bank Lehman Brothers is shopping itself to possible suitors, including Bank of America (BOA), drove a last-minute rebound in financial shares.

A nearly US$2 retreat in the price of oil also boosted the market, easing concern about consumer and business spending and sending airline and retail shares higher.

General Motors was another standout, with shares rising more than 11 per cent on hopes that Washington may provide a financial lifeline for US automakers. Ford jumped nearly 5 per cent a share to US$4.68.

Financial shares rallied after The Wall Street Journal reported that Lehman was courting suitors, including BOA.

That sector had been under steady pressure on fears that Lehman would not be able to raise much-needed capital to cover mortgage-related losses. The S&P financial index was up 1.5 per cent after having fallen around 4 per cent.

Lehman shares ended down nearly 42 per cent at US$4.22, just above a 3-1/2-year low of US$3.80 hit earlier. Investor fears that Lehman would fail to raise enough capital to cover its mortgage-related losses have kept it under steady pressure all week. BOA shares closed up 2 per cent at US$33.06.

The Dow Jones industrial average ended up 164.79 points, or 1.46 per cent, at 11,433.71. The Standard & Poor's 500 Index closed up 17.01 points, or 1.38 per cent, at 1,249.05. The Nasdaq Composite Index finished up 29.52 points, or 1.32 per cent, at 2,258.22.

Sourcce: Singapore Business Times - 12 Sep 2008