China's benchmark stock index rose by a record 8.3 percent after the government allowed the sale of new stock funds and increased efforts to restore power supplies and transport links after the worst snowstorm in more than 50 years.
The US stock market did not pick up the baton though. Again from Bloomberg:
U.S. stocks declined for the first time in three days after analysts told investors to sell American Express Co., Wells Fargo & Co. and Wachovia Corp. on concern a recession will worsen defaults among consumers...
The Standard & Poor's 500 Index fell 14.6, or 1.1 percent, to 1,380.82 after rallying 4.9 percent last week. The Dow Jones Industrial Average decreased 108.03, or 0.9 percent, to 12,635.16. The Nasdaq Composite Index retreated 30.51, or 1.3 percent, to 2,382.85. Almost seven stocks declined for every four that advanced on the New York Stock Exchange.
Perhaps investors just need to digest last week's gains, or feel that it was a bit overdone. After all, notwithstanding the 2.3 percent increase in factory orders in December, the economy is facing a real problem in tighter lending conditions, as Bloomberg reports.
The Federal Reserve said it became tougher for U.S. companies and consumers to get loans in the past three months, particularly to buy real estate.
Most lenders anticipate more delinquencies and losses this year, assuming "economic activity progresses in line with consensus forecasts," according to the central bank's quarterly survey of senior loan officers released today in Washington.