Skeptical kids can doubt whether Santa Claus exists. But for stock-market statisticians, there's not much debate: The year-end lift known as the Santa Claus rally is no myth.

The stock market typically posts modest, but reliable, gains in late December into the beginning of early January.

"It's pretty much like clockwork," says Jeff Hirsch, editor of the Stock Trader's Almanac, which tracks market trends. "And when it doesn't happen, it can be a very helpful warning of impending trouble."

This year the stock market began December in somewhat typical fashion with a stagnant first half of the month. The Standard & Poor's 500 Index is up just 0.6 percent so far in December, and the Dow Jones industrial average is down 0.2 percent.

That leaves room for the market to snap back by the end of the year, although stocks are still facing headwinds from lingering doubts about the economy as well as trepidation among investors about the huge gains logged so far this year. The S&P is already up 22 percent in 2009, the Dow 18 percent.

The entire period around the end of the year, though, has a bullish track record.

Consider:

&S226; November through January tends to be the best three-month span for stocks. Over the past four decades the average gain from Nov. 20 through the end of January has been 4.2 percent, or an annualized rate of 23 percent, according to James Stack, president of InvesTech Research in Whitefish, Mont.

&S226; December is the best single month, with the Standard & Poor's 500 stock index averaging a 1.6 percent gain. The first December after a bear market ends performs even better, averaging 3.1 percent.

&S226; The S&P has increased an average of 1.5 percent during the seven trading days that start with Christmas Eve and end with the first two days in January since 1950. That's the widely recognized period for the Santa Claus rally, as first identified in 1972 by Stock Trader's Almanac founder Yale Hirsch, Jeff's father.

&S226; Stocks went up in 12 of the last 15 of those year-end periods saving account payday loan.

To better understand what drives the Santa Claus rally, let's look at the variety of positive factors for the stock market that usually come together around this time of the year.

The holidays are the strongest retail season of the year, giving a boost to the economy while also generating positive headlines. Year-end investment reports also tend to offer upbeat outlooks for the coming year, and often plug hot stock picks just as investors are repositioning their portfolios.

And since lots of investors are already in a good mood this time of year anyway, more people tend to be buying rather than selling around the holidays.

"It's one of the most reliable rallies of the year," says Scott Marcouiller, senior equity strategist for Wells Fargo Advisers. "The probability is very high that we get a move up before the end of this year."

Also, investors who might normally sell stocks for tax purposes late in the year could be more likely to hold off this time around. Since this stock market rally is only nine months old, any gains from stocks bought this year would be considered short-term profits by the IRS. That would mean a much higher tax rate than gains on assets held for more than a year.

Even those who aren't interested in buying stocks during the holiday season would do well to keep an eye on the market. In years when there hasn't been enough enthusiasm for a Santa Claus rally, it's often been a sign that turmoil lies ahead.

After 1999, for example, when there was no Santa Claus rally, the market tanked in 2000. And a late-year drop two years ago was a forerunner to a disastrous 2008.

Some market experts take dim views of trends based on the calendar. But the Santa Claus rally still has plenty of believers on Wall Street.

Santa Claus rally could still show up this year

Already facing a spate of private lawsuits, the legal troubles of the country&S217;s largest credit rating agencies deepened on Friday when the attorney general of Ohio sued Moody&S217;s Investors Service, Standard &&8; Poor&S217;s and Fitch, claiming that they had cost state retirement and pension funds some $457 million by approving high-risk Wall Street securities that went bust in the financial collapse.

The case could test whether the agencies&S217; ratings are constitutionally protected as a form of free speech.

The lawsuit asserts that Moody&S217;s, Standard &&8; Poor&S217;s and Fitch were in league with the banks and other issuers, helping to create an assortment of exotic financial instruments that led to a disastrous bubble in the housing market.

&S220;We believe that the credit rating agencies, in exchange for fees, departed from their objective, neutral role as arbiters,&S221; the attorney general, Richard Cordray, said at a news conference. &S220;At minimum, they were aiding and abetting misconduct by issuers.&S221;

He accused the companies of selling their integrity to the highest bidder.

Steven Weiss, a spokesman for McGraw-Hill, which owns S.&&8; P., said that the lawsuit had no merit and that the company would vigorously defend itself.

&S220;A recent Securities and Exchange Commission examination of our business practices found no evidence that decisions about rating methodologies or models were based on attracting market share,&S221; he said.

Michael Adler, a spokesman for Moody&S217;s, also disputed the claims. &S220;It is unfortunate that the state attorney general, rather than engaging in an objective review and constructive dialogue regarding credit ratings, instead appears to be seeking new scapegoats for investment losses incurred during an unprecedented global market disruption,&S221; he said.

A spokesman for Fitch said the company would not comment because it had not seen the lawsuit.

The litigation adds to a growing stack of lawsuits against the three largest credit rating agencies, which together command an 85 percent share of the market. Since the credit crisis began last year, dozens of investors have sought to recover billions of dollars from worthless or nearly worthless bonds on which the rating agencies had conferred their highest grades.

One of those groups is largest pension fund in the country, the California Public Employees Retirement System, which filed a lawsuit in state court in California in July, claiming that &S220;wildly inaccurate ratings&S221; had led to roughly $1 billion in losses.

And more litigation is likely. As part of a broader financial reform, Congress is considering provisions that make it easier for plaintiffs to sue rating agencies. And the Ohio attorney general&S217;s action raises the possibility of similar filings from other states. California&S217;s attorney general, Jerry Brown, said in September that his office was investigating the rating agencies, with an eye toward determining &S220;how these agencies could get it so wrong and whether they violated California law in the process.&S221;

As a group, the attorneys general have proved formidable opponents, most notably in the landmark litigation and multibillion-dollar settlement against tobacco makers in 1998 faxless payday loan.

To date, however, the rating agencies are undefeated in court, and aside from one modest settlement in a case 10 years ago, no one has forced them to hand over any money. Moody&S217;s, S.&&8; P. and Fitch have successfully argued that their ratings are essentially opinions about the future, and therefore subject to First Amendment protections identical to those of journalists.

But that was before billions of dollars in triple-A rated bonds went bad in the financial crisis that started last year, and before Congress extracted a number of internal e-mail messages from the companies, suggesting that employees were aware they were giving their blessing to bonds that were all but doomed. In one of those messages, an S.&&8; P. analyst said that a deal &S220;could be structured by cows and we&S217;d rate it.&S221;

Recent cases, like the suit filed Friday, are founded on the premise that the companies were aware that investments they said were sturdy were dangerously unsafe. And if analysts knew that they were overstating the quality of the products they rated, and did so because it was a path to profits, the ratings could forfeit First Amendment protections, legal experts say.

&S220;If they hold themselves out to the marketplace as objective when in fact they are influenced by the fees they are receiving, then they are perpetrating a falsehood on the marketplace,&S221; said Rodney A. Smolla, dean of the Washington and Lee University School of Law. &S220;The First Amendment doesn&S217;t extend to the deliberate manipulation of financial markets.&S221;

The 73-page complaint, filed on behalf of Ohio Police and Fire Pension Fund, the Ohio Public Employees Retirement System and other groups, claims that in recent years the rating agencies abandoned their role as impartial referees as they began binging on fees from deals involving mortgage-backed securities.

At the root of the problem, according to the complaint, is the business model of rating agencies, which are paid by the issuers of the securities they are paid to appraise. The lawsuit, and many critics of the companies, have described that arrangement as a glaring conflict of interest.

&S220;Given that the rating agencies did not receive their full fees for a deal unless the deal was completed and the requested rating was provided,&S221; the attorney general&S217;s suit maintains, &S220;they had an acute financial incentive to relax their stated standards of &S216;integrity&S217; and &S216;objectivity&S217; to placate their clients.&S221;

To complicate problems in the system of incentives, the lawsuit states, the methodologies used by the rating agencies were outdated and flawed. By the time those flaws were obvious, nearly half a billion dollars in pension and retirement funds had evaporated in Ohio, revealing the bonds to be &S220;high-risk securities that both issuers and rating agencies knew to be little more than a house of cards,&S221; the complaint states.

Ohio Sues Rating Firms for Losses in Funds

SAN FRANCISCO – The Gymboree Corp. on Thursday said its third-quarter sales at stores open at least a year fell 4 percent, but the children's retailer nevertheless raised its profit forecast for the period.

The figure is an important gauge of retail health, because it measures performance at existing stores, rather than newly opened ones.

Net sales for the quarter ended Oct. 31 rose 2 percent, to $265.6 million, from $261.3 million a year ago.

Analysts polled by Thomson Reuters, on average, were expecting sales for the quarter of $273 business cards.5 million

Gymboree now expects third-quarter profit between $1.10 and $1.13 per share, up from its prior forecast of between $1.05 and $1.10 per share. Analysts project a profit of $1.10 per share.

The company plans to report full third-quarter results on Nov. 18.

Gymboree shares fell $2.36, or 5.4 percent, to $41.17 in morning trading.

Gymboree 3rd-qtr sales comparison falls 4 percent

Hot News: Dow, S&P 500 open up on data optimism

LONDON (AFP) – Britain&&9;s government is to create three new high street banks from bailed out lenders Royal Bank of Scotland, Lloyds Banking Group and Northern Rock, according to media reports.

The huge shake-up comes as the government seeks to recoup taxpayers&&9; cash used to prop up the banks during the world financial crisis and increase competition.

Lloyds is 43 percent owned by the state and RBS 70 percent, while Northern Rock was nationalised outright.

The government could confirm the move, to come in by 2015, on Tuesday, reports said.

The new banks would be retail-focused, concentrating on deposits and mortagages.

RBS and Lloyds are also reportedly set to sell off some parts of their businesses, including around 300 branches for RBS low rate payday loans.

EU regulators last week approved the state aid contained in plans to break up and sell Northern Rock.

All three banks received huge government bailouts at the height of the global economic storm but regulatory authorities are concerned about such state-backed banks having an unfair advantage over those that were not helped.

The Sunday Telegraph reported that no current owner of a British retail bank would be allowed to take on the new institutions so buyers could come from the US, Australia and the Middle East.

Britain to create three new retail banks: reports

TOKYO (Reuters) – The Japanese government has decided to put a state-backed turnaround body in charge of the revitalisation of Japan Airlines (9205.T), the Nikkei business daily said on Sunday, underlining the government&&9;s deeper involvement in the process.

Liabilities at JAL would exceed its assets by as much as &&6;8.8 billion if Asia&&9;s largest airline by revenues were liquidated, a source with direct knowledge of the matter said on Friday, underscoring the depth of the problems facing the airline as it seeks aid from banks and the state to avoid bankruptcy.

The state body, the Enterprise Turnaround Initiative Corporation of Japan (ETIC), invests in and buys debt of companies with strained balance sheets and dispatches turnaround specialists to assist them in restructuring.

JAL is now set to slash its debt under the government&&9;s guidance and come up with a drastic restructuring scheme, the Nikkei said. The decision to put JAL under ETIC&&9;s supervision will be announced as early as this week, the paper said.

The ETIC, established earlier this month, will operate like an investment fund and will initially have the ability to procure up to 1 auto loans for people with bad credit.6 trillion yen (&&6;17 billion) in state-guaranteed funding in the current fiscal year to March 2010.

No officials at the ETIC were immediately available for comment.

A task force led by turnaround specialists, which reports to Transport Minister Seiji Maehara, has been seeking a bridge loan of about 180 billion yen and a total capital boost of 300 billion yen from both the government and the private sector, the source said.

The government, working with the ETIC, will look into a new and more in-depth turnaround scheme for the airline, while paying heed to the task force&&9;s existing plans, the Nikkei said.

JAL is headed for its fourth annual loss in five years, weighed down by roughly &&6;15 billion in debt and a bloated cost base that makes it less efficient than domestic rival All Nippon Airways Co (9202.T).

(&&6;1 = 92.04 Yen)

(Reporting by Kiyoshi Takenaka; Editing by Sugita Katyal)

Govt-backed body to oversee JAL turnaround: Nikkei

HONG KONG, Oct. 23 (Xinhua) -- A survey on Friday showed 30 percent of business owners in Hong Kong expect a profitable fourth quarter, the most optimism seen since the financial turmoil erupted in the third quarter of last year.

The quarterly business tendency survey by the Hong Kong government's Census and Statistics Department found 30 percent respondents expect their business situation to be better in the fourth quarter over the third, with 17 percent forecasting it to worsen.

The proportion of respondents expecting their business situation in the fourth quarter to be better than the preceding quarter grew to 30 percent, as compared with 11 percent and 20 percent in the second and third quarter.

The retail sector has the most favorable outlook, followed by the financing and insurance sector. However, 38 percent of respondents in the construction sector expect business to fall.

Consistent with the expectations on the overall business situation, respondents in most of the surveyed sectors expect an increase in volume of business or output in the fourth quarter new car loans. Significantly more respondents in the retail sector, and financing and insurance sector, expect their volume of business to increase, as against those expecting it to decrease.

Respondents in most surveyed sectors have a favorable employment outlook for the fourth quarter. Yet more respondents in the import-export trade, and the wholesale and information and communications sectors, expect employment to fall.

More respondents in the real estate, retail, accommodation and food services, and transportation, storage and courier services sectors expect their selling price or service charge to rise, than those expecting it to go down. More respondents in the construction sector expect their tender price to decline, than those expecting it to rise.

HK business forecast better for Q4: survey

Deputy commander of the Iranian Revolutionary Guard's ground force, Gen. Noor Ali Shooshtari is among those killed in the attack, Sunday, 18 Oct. 2009

Iranian state media report that a suicide bomber in the troubled southeast killed at least 30 people early Sunday, including six commanders of Iran's elite Revolutionary Guard force.  Iranian state media say the suicide bomb blast killed the deputy commander of the Revolutionary Guards ground forces and the commander of the Guards in the troubled Sistan Baluchistan region, which borders Pakistan.The reports say the attacker targeted people gathering in the city of Pisheen for a reconciliation meeting between local Shi'ite and Sunni leaders.  Minority Sunni groups, in particular ethnic Baluchis, have long complained of discrimination in the Shi'ite dominated country.The chief prosecutor in the region was quoted as saying the Sunni insurgent group Jundallah, or Soldiers of God, claimed responsibility for the attack.  There has been no direct word from the group, which has carried out anti-government attacks in the past.Paul Ingram, co-director of the London-based  British-American Security Information Council, notes that similar attacks have been going on for years.  But he says this one stands out. "This is a very unusual attack in as much as it appears to be a successful attack upon the Revolutionary Guards at such a high level involving so many of the senior officers," he said online cash advance.Iran's speaker of parliament, Ali Larijani, accused the United States of being behind the attacks.   The U.S. State Department condemned what it called "this act of terrorism" and mourned the loss of innocent lives.  It said allegations of U.S. involvement were "completely false." Security analyst Paul Ingram says such allegations are problematic. "It is very difficult to really pin down and there have been these sorts of accusations from the Revolutionary Guards in the past," he said.Ingram notes the Iranian government has an interest in deflecting blame to foreign elements.Tehran is under pressure both at home, over the disputed presidential election in June, and abroad, for its controversial nuclear program, which the United States suspects could be aimed at developing nuclear weapons.  Iran, which denies that charge, has recently agreed to allow western inspectors to look at a newly revealed uranium enrichment facility and has been holding talks with the United States and other western nations on ways to ease concerns about its nuclear program.

Suicide Blast in Iran Kills Top Revolutionary Guard Leaders

After reporting big profits over the last six months, Bank of America lost $1 billion in the third quarter as growing numbers of consumer loans soured and the bank paid millions of dollars to wean itself off government life support.

Bank of America posted a loss of 26 cents a share for the three months from July through September, compared with a profit of $3.2 billion in the second quarter. Wall Street analysts had been expecting a loss of 12 cents a share. The bank earned $1.18 billion or 15 cents a share in the quarter a year ago.

&S220;Obviously, credit costs remain high, and that is our major financial challenge going forward,&S221; said the bank&S217;s chief executive, Kenneth D. Lewis. &S220;However, we are heartened by early positive signs, such as the leveling of delinquencies among our credit card numbers.&S221;

The bank added $2.1 billion to its reserves to cover more credit losses as unemployment surges and households struggle to keep up on their loans, and it spent more than $400 million to extract itself from an agreement with the government that guaranteed potential losses of its brokerage Merrill Lynch.

Aside from its roster of troubled consumer credit and loan products tied to the sagging mortgage market, Bank of America is beset with problems that run from Washington to civil courtrooms to its own boardroom.

Mr. Lewis announced in late September that he would step down at the end of the year, leaving a leadership vacuum as the bank searches for a successor who can restore the bank&S217;s tarnished image and remove the government crutches holding it up.

Bank of America has accepted some $45 billion in taxpayer bailouts since the financial crisis erupted last year, and has issued in debts backed up by the government no teletrack payday loan. While rivals like Citigroup and Wells Fargo also remain on government support, stronger competitors like Goldman Sachs and JPMorgan Chase have already paid back their bailouts, freeing themselves of the scrutiny and stigma that came with taking the bailout.

A day before reporting its earnings, the bank tried to quell some of the furor over its management and bonus structure by announcing that Mr. Lewis promised to return the pay he received this year to avoid a confrontation with Kenneth R. Feinberg, the Obama administration&S217;s overseer of executive compensation..

While Merrill&S217;s brokerage business may be adding meat to Bank of America&S217;s bottom line, investigations over the $50 billion deal that folded the thundering herd into Bank of America still pose legal tangles and publicity headaches for the bank. Regulators, members of Congress and shareholder lawsuits are examining the merger and questions over bonuses paid out to Merrill executives on the eve of the deal.

Already, e-mail messages have surfaced in which one Bank of America director sums up his take on the Merrill deal by saying, &S220;Unfortunately it&S217;s screw the shareholders!!&S221; Now, Bank of America&S217;s board has voted to partially waive attorney-client privilege, perhaps setting the stage for more disclosures about the boardroom intrigue leading to the Merrill deal.

With $1 Billion Loss, Bank of America Misses Its Forecast

Filed at 7:00 a.m. ET

LONDON (AP) -- World stock markets rallied Wednesday after an upbeat earnings statement from Intel Corp., the world's largest chipmaker, and China's economy showed more signs of a recovery.

Meanwhile, oil prices rose to a year high while the dollar slid to a 14-month low against the euro amid the rising appetite for risk.

In Europe, the FTSE 100 index of leading British shares was up 89.57 points, or 1.7 percent, at 5,243.72 while Germany's DAX jumped 109.05 points, or 1.9 percent, to 5,823.36. The CAC-40 in France was 66.26 points, or 1.7 percent, higher at 3,867.65.

Wall Street is poised for big gains too when the markets open -- Dow futures were 106 points, or 1.1 percent, at 9,915, while the broader Standard &&8; Poor's 500 futures rose 13.8 points, or 1.3 percent, to 1,082.60.

Intel has been the catalyst to Wednesday's advance. In an after-hours statement on Tuesday, Intel unveiled better-than-expected third quarter profits and upped its earnings guidance for the year as demand for computers recovers.

''The better than expected numbers show one of the first major companies to report a more sustainable recovery instead of heavily cutting costs,'' said James Hughes, market analyst at CMC Markets.

Investors around the world are focusing in on the third-quarter earnings statements, which are kick up a gear this week to see how much companies have been able to drive up earnings by generating revenues as opposed to cutting costs.

The market reaction to Intel has been positive because the company is seen as a bellwether for the health of the U.S. economy.

Major U.S. financial institutions take center stage over the rest of the week. JP Morgan Chase &&8; Co. unveils its third-quarter earnings later, followed on Thursday by Goldman Sachs Group Inc. and Citigroup Inc. On Friday, it's Bank of America Corp.'s turn.

The financial sector, which led the market down at the outset of the crisis, generally outperformed other sectors, leading the market on the way up since March's lows.

''The figures from the banks could be a defining moment in the current rally; strong results could be seen as confirmation we are on the way to recovery, though the market will be very sensitive to any signs of bad news on the horizon,'' said Tom Salmon, head trader at Spreadex in London guaranteed cash advance.

Other companies due to report this week include Google Inc., IBM Corp. and General Electric Co.

World markets have also been buoyed by the news that the slump in China's exports eased in September -- a further sign that global trade is improving.

Combined with huge amounts of easy money freed up by governments to rebuild their economies and companies, growth in China has helped drive Asia's markets in the last six months

China's Shanghai index jumped 34.34 points, or 1.2 percent, to 2,970.53, while Hong Kong's Hang Seng rose 419.12 points, or 2 percent, to 21,886.48.

Japan's market was the region's only major laggard with the Nikkei 225 stock average shedding 0.2 percent to 10,060.21 amid a stronger yen, which hurts exporters.

Elsewhere, Australia's market gained 1 percent, India's benchmark added 1.2 percent and Taiwan's key index advanced 1.3 percent.

The slumping dollar sent commodities -- which are largely priced in dollars and therefore tend to rise when the U.S. currency falls -- surging once again. Gold traded near an all-time high around $1,070.

Oil blew past its previous 2009 high of $75 a barrel for a while, hitting $75.15, its highest level since October 2008. By late morning London time, a barrel of crude for November delivery was up 79 cents to $74.94.

The dollar fell 0.6 pen to 89.15 yen while the euro rose 0.3 percent to $1.4899, having earlier struck a new 14-month high of $1.4913.

Wednesday's fall in the dollar has echoed developments in the currency markets ever since the financial crisis exploded over a year ago. Whenever investors grow more willing to take on risk, stocks have rallied and the dollar has dropped against the euro.

--------

AP Business Writer Jeremiah Marquez in Hong Kong contributed to this report.

Stocks in Europe and Asia Rise on Trade and Intel Data

BRUSSELS &S212; The economy of the euro zone shrank more than expected in the second quarter of this year because private demand and trade were lower than previously estimated, data released Wednesday showed. But analysts said it was still likely that the region was already returning to growth.

The European Union statistics office Eurostat reported that gross domestic product in the 16-country euro area contracted 0.2 percent in the April-to-June period, compared with the previous quarter, and by 4.8 percent in annual terms.

This compared with the previously reported drops of 0.1 percent and 4.7 percent. Economists polled by Reuters had expected Eurostat to confirm its previous estimates.

But Howard Archer, an economist at Global Insight, said that what he termed the &S220;modest downward revision&S221; in figures for the second quarter &S220;does not materially change the picture.&S221;

&S220;It still indicates that the euro zone economy was close to stabilizing in the second quarter after a year of deep overall contraction, and it still seems likely that the region returned to growth in the third quarter, albeit modest,&S221; he said.

He forecast 0.3 percent growth in the just-concluded third quarter, compared with the second.

A plunge in inventories was slightly smaller than previously reported immediate payday loans online. The drop in stocks of finished goods took away 0.6 percentage point from the overall result in the second quarter, rather than the 0.7 percentage point reported previously.

Also the contribution from government spending was higher than previously reported, at 0.2 percentage point, rather than just 0.1 percentage point, showing the positive effects of stimulus packages that have injected money into economies.

But this was more than offset by a downward revision of the positive contributions made by household demand and trade. Consumer demand was zero rather than a positive 0.1 percentage point and trade added 0.5 percentage point, rather than 0.7 points as estimated earlier.

Eurostat data also showed the recession turned out to be deeper than previously estimated in the Netherlands and Austria.

The data is likely to add to European Central Bank caution not to withdraw its monetary stimulus prematurely when the E.C.B. meets to decide interest rates on Thursday.

Economists say they believe the E.C.B. will keep rates at a record low 1 percent until the third quarter of 2010.

Reuters

Euro-Zone G.D.P. Shrank More Than Expected in Quarter

Hot News: Regulators Plan to Study Risks of Atrazine

LONDON (AFP) – European stock markets edged lower on Thursday, the first day of the fourth quarter, as investors paused after London&&9;s biggest-ever quarterly gain on economic recovery hopes, dealers said.

The FTSE 100 index eased 0.47 percent to 5,109.80 points in late morning trade.

Frankfurt&&9;s DAX 30 slid 0.38 percent to 5,653.47 points and in Paris the CAC 40 drifted 0.61 percent lower to 3,772.21 points.

The DJ Euro Stoxx 50 index of top eurozone shares dipped 0.59 percent to 2,855.64.

London&&9;s FTSE had surged by a record-breaking 21 percent during the third quarter, which ended on Wednesday, as investors were heartened by mounting evidence that the global economy was on the mend.

German shares jumped 15 percent and French stocks soared by 17 percent in value in the three months to the end of September.

"The FTSE 100 has enjoyed its best ever quarter, adding 21 percent over the last three months, leaving many to ask the question whether the rally can now continue," said analyst Ben Potter at financial betting firm IG Index.

"Certainly any pick up in mergers and acquisitions activity will lend support across the board, whilst higher resource prices will support the heavyweight mining and petrochemicals sectors."

However, European equities had fallen for the second day running on Wednesday, after publication of worse-than-expected jobs data in the United States, which is the world&&9;s biggest economy.

Despite ending in negative territory, the London FTSE has now gained about 15 percent since the start of 2009.

ODL Securities analyst John Murphy also questioned whether the rally was sustainable.

"A stellar run has left the markets looking healthy, but investors are still asking themselves if it is a bubble, and if so, when will it burst?" Murphy commented easy payday loans.

"Whilst it is important to appreciate the past, one needs to keep looking forward, and as we enter October, will talk of crashes become a self-fulfilling prophecy?"

Wall Street shares fell for the second consecutive day on Wednesday after data showing a steep drop in private sector payrolls fuelled increased jitters on the economic outlook.

The Dow Jones Industrial Average shed 0.31 percent to close at 9,712.28 in a roller-coaster session.

Despite ending the day on a deficit, the Dow closed the third quarter with an impressive 15 percent gain -- its best quarter since 1998.

Meanwhile in Asia on Thursday, Japanese shares sank 1.53 percent, hitting a two-month low in the wake of losses on Wall Street and signs that Japanese firms plan to curb their investment, dealers said.

Tokyo&&9;s benchmark Nikkei-225 index ended at 9,978.64, the weakest close since July 24.

The Nikkei had closed the third quarter on Wednesday with a slender gain of 1.7 percent.

Hargreaves Lansdown analyst Richard Hunter said the upcoming third-quarter company results season would prove crucial for stocks.

"Over the next few weeks, third-quarter earnings will gradually take centre stage. These results will have a major bearing on where markets go next," he said.

On the foreign exchange market, the European single currency fell to 1.4576 dollars in Thursday morning deals.

European equities slip at start of fourth quarter

AMSTERDAM (Reuters) – Belgian drugs, chemicals and plastics maker Solvay (SOLB.BR) said on Monday it would sell its drugs unit to U.S. partner Abbott Laboratories (ABT.N) for 4.5 billion euros (&&6;6.5 billion) in cash and reinvest in chemicals and plastics.

Abbott had agreed to buy the unit to bolster its flagging prescription drug business by giving it a number of new medicines in late-stages of testing, sources familiar with the deal had earlier told Reuters.

"We are building a new refocused group with the financial means to further accelerate sustainable growth," Solvay&&9;s board chairman Alois Michielsen said in a statement.

The enterprise value of the deal is 5 fast payday loans.2 billion euros, including 4.5 billion in cash, additional potential milestone payments of up to 300 million euros between 2011 and 2013 and liabilities of about 400 million euros.

Solvay said the proceeds from the deal will be reinvested in external and organic growth in strategic projects in chemicals and plastics with a sharp focus on long term value creation.

Studies about such reinvestments are ongoing, it added.

(Reporting by Aaron Gray-Block)

Solvay sells drugs unit to Abbott for $6.5 billion

Stock markets stampeded higher on Wednesday and major Wall Street benchmarks touched their highest levels in 11 months on optimism that an economic rebound was under way.

Financial shares like credit-card companies and regional banks led a buying spree that lifted most corners of the financial markets.

Investors anticipating a resurgence in industrial output clamored to snap up crude oil, copper and other raw materials used to feed factories. Those who expect inflation pushed the price of gold sharply higher. And optimistic stock traders helped to send the Dow 100 points higher.

At the close, the Dow Jones industrial average was up 108.30 points or 1.12 percent, to 9,791.71, and the broader Standard &&8; Poor&S217;s 500-stock index was 1.5 percent or 16.13 points higher at 1,068.76, climbing to its highest levels since early October. The Nasdaq rose 1.45 percent or 30.51 points, to 2,133.15.

&S220;We&S217;ve been riding this thing for a long time,&S221; said Bill Strazzullo, chief market strategist at Bell Curve Trading. &S220;You notice that the sell-offs never last more than a couple days. We&S217;re going to stay with it. We still think there&S217;s a little bit more to go.&S221;

Mr. Strazzullo said his firm was eyeing benchmarks of 1,100 and 1,150 on the S.&&8;P. 500 (it is currently trading at about 1,060) as moments to pause and take some profits and reassess whether the markets seem primed for more gains.

It has been a good week for the bulls on Wall Street.

A new report on industrial production showed that factories, mines and utilities ramped up their output for a second month in August, a harbinger that a recovery was under way. On Tuesday, the Federal Reserve chairman, Ben S instant payday loans. Bernanke, said that the recession was most likely over, though he warned of a plodding recovery.

&S220;You&S217;re getting more evidence that the economy&S217;s turning,&S221; said Anthony Dwyer, equity market strategist at FTN Equity Capital Markets. &S220;This is going to be a big recovery because it was a big decline.&S221;

Shares of Bank of America and JPMorgan Chase were each up more than 2 percent, and a closely watched index of regional bank shares was up more than 5 percent.

And as stocks surged, Wall Street&S217;s gold rush intensified.

The price of gold leaped $13 to $1,018 an ounce as traders bet that prices of precious metals would continue to climb as the dollar weakened and the economy healed. Investors rushed to buy crude oil, copper and other commodities that could weather an outbreak of inflation.

Some investors believe that inflation &<51; or at least, the fear of inflation &<51; is seeping back into the economy as factories restart production and industrial output rebounds. The government reported on Wednesday that retail prices rose 0.4 percent last month, largely because of a spike in gasoline costs.

Even though the Federal Reserve expects inflation to remain under wraps with so much slack in the economy and millions of people out of work, investors anticipating a surge in prices and a weaker dollar are betting heavily on commodities and other currencies. Crude-oil prices rose to $72 a barrel in New York, and the dollar&S217;s value slumped against six major currencies, dipping to its lowest levels in almost a year.

Gold and Stocks Move Sharply Higher

Hot News: U.S. home builder sentiment highest since May 2008

The United States stock market has just completed its best six months since 1933. From March 9 to Sept. 9, the Standard &&8; Poor&S217;s 500-stock index leaped by 53 percent.

But the gain over that period, which began when stocks reached their nadir in March, was not enough to offset the losses recorded in the previous six months. Not since 1932 had the market suffered a half-year period as bad as that one.

Investors clearly found it difficult to determine whether the Great Recession would turn into Great Depression II.

Amazingly, however, the American stock market was one of the least volatile markets in the world in the last year. It was among the best markets when it was plunging, and among the worst when it was soaring. Over all, it ranked near the bottom among international markets.

Whatever else you might want to say about the virtues of international diversification, in this cycle it has done little to balance the risks of investing in any one market. When the markets went down, they nearly all went down. When the markets rose, they soared together.

If history is a guide, the strong recovery may be an indication that better prices are still ahead. Since World War II, there have been eight periods before the current market when the S.&&8; P. 500 managed to rise at least 30 percent over a half-year period &<51; in 1963, 1971, 1975, 1980, 1982-83, 1991, 1997 and 1999. A year later, the index had made further gains in seven of them.

The exception was 1980, when the economy went into a double-dip recession and dashed the hopes of investors who had bet on a continued rise in stock prices.

Before that, the record was less impressive. Soaring prices in 1929 presaged the Great Depression, and a sharp rebound in 1930 proved to be a suckers&S217; rally. But big gains in 1932-33 and 1935 were followed by additional gains. Prices were little changed a year after large gains in 1938 and 1943.

The accompanying graphic demonstrates the truth of an old adage: If you lose 50 percent of your money, and then gain 50 percent, you have not come close to breaking even.

Italy provides one of the best examples of that. Over the six-month period ending on Wednesday, the FTSE/MIB index of Italian stocks rose 81 percent in euros payday loans. With the euro also strong against the dollar during that period, the Italian index more than doubled, rising 109 percent from the perspective of a dollar-based investor.

But an investor who put money in the Italian stock market exactly one year before, on Sept. 9, 2008, suffered a decline of 55 percent in euros, or 60 percent in dollars, during the next six months. The Italian market, like the American market, hit bottom on March 9 of this year.

The net impact: For the 12 months, the Italian market was down 17 percent, whether measured in euros or in dollars.

The accompanying graphic shows the performance of major stock market indexes in each of the 19 countries in the Group of 20, as well as of a European-wide index that is shown because the European Union is the final member of the Group of 20, whose leaders will meet later this month in Pittsburgh, to discuss efforts to fight the world financial crisis.

For the entire year, the best performances were turned in by emerging markets, which are back in favor with investors hopeful of a resumption of global growth. China, whose market had plunged earlier than most, was the only one to rise during the six-month period through March 9, and was the best performer for the entire year. Brazil, Indonesia and South Africa also showed gains for the 12 months, while the Indian market broke even and the South Korean market nearly did the same.

For the entire year, the largest declines were in Saudi Arabia and Russia, oil producers that suffered from lower oil prices brought on by the global slowdown.

The similarity in international performance can also be seen within markets. During the most recent six months, the three best-performing sectors in the S.&&8; P. 500, and in the S.&&8; P. Europe 350, were financials, industrials and materials. During the previous six months, they were the worst-performing sectors in both indexes.

Floyd Norris comments on finance and economics in his blog at nytimes.com/norris.

Off the Charts: Globally, It’s Markets See, Markets Do

The McDonald&S217;s Corporation said Wednesday that sales at established restaurants rose 2.2 percent globally in August, missing analysts&S217; targets, as strength in Europe failed to offset weakness in the United States and other parts of the world.

Sales at established restaurants, those open at least 13 months, rose 3.5 percent in Europe, helped by Britain and France, and increased 1.7 percent in the United States, where intense fast-food price competition weighed on results. Comparable sales slipped 0.5 percent in the Asia Pacific, Middle East and Africa segment, McDonald&S217;s said Wednesday.

Analysts had expected an increase of 2.8 percent in the United States. On a global basis, some estimates called for a sales increase of as much as 3 percent.

McDonald&S217;s said sales in the United States were supported by the new premium Angus Third Pounder burger and new McCafe coffee drinks payday loan.

McDonald&S217;s said sales rose 1.1 percent systemwide in August, but were up 4.1 percent excluding the impact of currency fluctuations.

As a result of diners&S217; continued cautious spending, McDonald&S217;s has focused its advertising on its core and value menus and away from higher-priced items &<51; with the exception of the new Angus burger, which is being introduced across the United States.

Stock in McDonald&S217;s, which is based in Oak Brook, Ill., fell $1.13, to close at $55.09 a share.

McDonald’s Sales Rise 2.2%, but Miss Analysts’ Targets