GLOBAL MARKETS

World stocks took another dive on Friday despite early attempts at a rebound in Europe while currency dealers drove the Japanese yen to a 14-month high against the dollar, throwing out risky leverage. Wall Street looked set for a weak opening.

Stocks surged on Friday to end a turbulent week after the Federal Reserve cut the discount rate it charges banks in an emergency move to stabilize credit markets and keep the economy on track. World stock markets have fallen sharply, with investors fleeing riskier assets as problems in U.S. subprime mortgage lending spread rapidly in other credit markets .

A remarkable end-of-day rally pushed the benchmark S&P 500 higher on Thursday after investors snatched up financial stocks that looked cheap after weeks of pummeling by global credit market turmoil.

The yen had its biggest rise against the dollar in six months in volatile trading on Thursday as investors fearing a global credit crisis exited risky trades financed by borrowing the Japanese currency.

Shares of Apple Inc. tumbled as much as 7 percent on Thursday as investors targeted the high-flying stock in a general U.S. market slide prompted by credit fears.

Fears that tighter credit in the U.S. subprime housing sector will choke off growth in other sectors sent stock markets around the world sharply lower on Thursday while government bonds rallied in a flight to safety.

The Dow industrials closed lower for a sixth day on Thursday on fears that credit markets may break down and hurt the economy and profits, but a remarkable late-day surge almost brought them back into the black.

The yen rallied across the board on Thursday, reaching its highest against the dollar in more than a year, as investors worldwide fled carry trades in the wake of a global plunge in stocks which triggered safe-haven buying of U.S. Treasuries.

U.S. stocks fell on Wednesday, with the S&P 500 wiping out what was left of its 2007 gains, as credit jitters sparked a broad stock market sell-off. Shares of Countrywide Financial Corp. fell 16.2 percent to $20.51 on the rumors that the largest U.S. mortgage company has been unable to raise money from the commercial paper market. Countrywide officials were not immediately available for comment.

Japan's Nikkei plumbed a 2007 low and other Asian stock markets fell as much as 6 percent on Wednesday as investors shunned risky trades amid growing credit jitters, pushing the yen to a 4 and a half month high. The nervous sentiment is set to hit Europe, where financial bookmakers are calling for falls of half a percent or more for major indexes.

U.S. stocks skidded on Tuesday on fresh signs that global credit markets were seizing up, while a lower profit forecast from Wal-Mart Stores Inc. renewed worries about consumer spending. Wal-Mart's pessimistic outlook and subsequent news that a U.S. investment firm wants to halt redemptions delivered a one-two punch to already shaky confidence.

U.S. Treasuries climbed on Tuesday after several Canadian investment trusts had trouble repaying short-term loans, further evidence that a crisis that began in mortgages has led to a wider credit crunch.

VMware Inc. shares soared 79 percent in the software maker's trading debut early Tuesday, a start following an initial public offering that initially lived up to hopes that it could be Wall Street's hottest IPO of the year.

Stock index futures were little changed on Tuesday before data on inflation that could shed light on the Federal Reserve's next move in dealing with a deteriorating credit environment.

Stocks edged higher on Monday after central banks pumped more cash into the global financial system and a report showed U.S. consumers spent more freely than expected last month.

With world stocks have fallen more than 7 percent in a month and some indexes down more than 10 percent from their highs, some market players are saying the time is near to buy.

Asian stock markets made a tentative recovery on Monday following last week's hammering as fears of a global credit crisis eased after central banks around the world pumped money into banking systems.

Stock index futures signaled a rebound on Wall Street on Monday after gains in overseas markets and data showing U.S. retail sales grew last month, reassuring investors about consumer spending.

On the heels of a crisis, investment bank shares are looking cheap. Some say it's a great time to buy.

It will be a weekend of high anxiety for investors on Wall Street, as they brace themselves for what will likely be another rollercoaster ride for the battered financial markets.

Countrywide Financial Corp led shares of U.S. mortgage companies lower on Friday as investors received fresh reminders that a shortage of liquidity might crimp profits.

The last time the U.S. markets experienced such wild swings as they have in the past week, Wall Street warriors in their 20s and 30s were trading baseball cards and lunchbox snacks, not stocks and bonds.

Wall Street economists do not foresee an imminent interest rate cut from the Federal Reserve despite a credit squeeze that is pressuring financial markets and forcing central banks to funnel liquidity into the system.

Wall Street's roller-coaster ride, triggered by the meltdown in subprime mortgage lending, is spreading pain through financial markets -- but has not hit Main Street yet.

Central banks probably will halt their monetary tightening campaign and the Federal Reserve may start cutting interest rates to ward off a global credit crunch, financial market dealers said on Friday.

After a wave of initial public offerings in recent years, the total market value of stocks listed on two major Chinese stock exchanges surpassed the country’s GDP for the first time on Thursday.

Tighter credit, broad deterioration in the housing market and skittish consumer spending will lead to a slower U.S. economy than earlier estimated, according to the most closely watched forecast by U.S. economists.

U.S. regulators are scrutinizing the books of some top Wall Street brokers and investment banks for subprime-mortgage losses, according to a report in the online version of the Wall Street Journal.

European stocks extended their losses on Friday, losing more than 2 percent as a deepening concern surrounding the U.S. subprime mortgage market continued to hit stocks worldwide and pushed U.S. futures in the red.