* Washington sets rescue of Citigroup; stock jumps 60 pct
* Obama to unveil his economic leadership team
* Financial shares lead market's advance, indexes up 4 pct
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STXNEWS/US
(Updates to midmorning)
By Ellis Mnyandu
NEW YORK, Nov 24 (Reuters) - U.S. stocks rose on Monday as
investors breathed a sigh of relief after Washington agreed to
pump $20 billion into Citigroup <C.N>, averting a bank collapse
that could have imperiled the global financial system.
Shares of Citigroup jumped more than 60 percent to $6.06 on
the New York Stock Exchange as investors welcomed the rescue of
the No. 2 U.S. bank, whose shares last week plunged to their
lowest levels in about 15 years amid a crisis of confidence.
Citi's rescue is the biggest U.S. bank bailout yet and
underscores the widening fallout from the credit crisis that
begun more than a year ago.
The news lifted other financial shares. Bank of America
<BAC.N> was up nearly 10 percent to $12.55, Morgan Stanley
<MS.N> , up 12 percent to $11.24 and Goldman Sachs <GS.N>, rose
nearly 5 percent to $55.72. The S&P 500 financial index climbed
4.6 percent.
"The news on Citigroup is about confidence," said Cummins
Catherwood, managing director at Boenning and Scattergood in
West Conshohocken in Pennsylvania. "There's not a master stroke
that's going to make everybody come out and be happy again.
Confidence is a mosaic that has to be put up piece by piece and
the Citi plan is just one piece."
The Dow Jones industrial average <> shot up 327.67
points, or 4.07 percent, to 8,374.09. The Standard & Poor's 500
Index <.SPX> jumped 35.63 points, or 4.45 percent, to 835.66.
The Nasdaq Composite Index <> leaped 61.35 points, or 4.43
percent, to 1,445.70.
Sentiment was also buoyed by expectations that
President-elect Barack Obama's would lay out a plan for a
two-year economic stimulus package involving the creation of
2.5 million jobs over two years.
Emerging certainty about who will be in Obama's economic
leadership team also added to the positive tone.
In a bid to bring calm to the market, Obama is due to
announce his economic leadership team at 12 noon (1700 GMT) on
Monday. New York Federal Reserve Bank President Timothy
Geithner is expected to be tapped as the new U.S. Treasury
Secretary.
Shares of Citigroup were among the Dow's top boosts, along
with JPMorgan. A jump in energy shares underpinned gains in
shares of energy companies, putting Exxon Mobil <XOM.N>, up 2.8
percent at $77.92, among the standouts.
On Nasdaq, shares of big-cap technology companies led
gains, with Apple Inc <AAPL.O> , up more than 6 percent at
$87.90.
Campbell Soup Co <CPB.N>, considered a recession-proof
play, however, stunned investors with a disappointing full-year
profit outlook, sending its shares down more than 6 percent to
$33.91 on the NYSE. []
Shares of Xerox Corp <XRX.N> climbed more than 16 percent
to $6.13 after the world's top supplier of digital printer and
document management services forecast 2009 profits generally in
line with analyst expectations. []
Citigroup's rescue follows the disappearance or
bankruptcies of such Wall Street names as Bear Stearns Cos,
Lehman Brothers Holdings Inc <LEHMQ.PK> and Washington Mutual
Inc <WAMUQ.PK>. In addition to the new capital, Washington
effectively guaranteed most of Citi's $306 billion losses on
high-risk assets.
(Editing by Kenneth Barry)
