Money Morning asked: By Mike Caggeso Associate Editor Money Morning A spree of economic props dominoed across Europe today (Thursday) all sharing the same theme - stopping the global financial crisis from getting worse.The European Central Bank took a drastic step to protect the Eurozone economy from shrinking further by lowering its benchmark interest rate by three-quarters of a percentage point to 2.5%.As ECB President Jean-Claude Trichet announced the largest cut in the Eurozone’s 10-year history, he said that the region is bracing for negative growth next year."Global and euro-area demand are likely to be dampened for a protracted period of time," Trichet said at a press conference in Brussels today, Bloomberg reported.The ECB estimates average annual real gross domestic product (GDP) growth to be between 0.8% and 1.2% in 2008, between -1.0% and [+]

Vritika Ray asked: The Indian share market did witness the much-awaited year-end rally some time back. The market news is that the benchmark Sensex gained nearly 400 points in two trading sessions. As a result, it managed to hit the crucial 10,000 mark some time back. The Nifty also closed above the psychologically important 3000 mark, for three consecutive sessions. All these gains were made on the back of firm cues from Asian markets and a drastic drop in inflation, which fell below 6 per cent.  But again, this was not to last. The rally soon fizzled out and the Sensex closed way below the 10K mark in the week ended December 26.The Sensex ended 7.6 per cent lower in this week while the Nifty lost 7.1 per cent to finish at 2857. Year-end [+]

Money Morning asked: While the U.S. Federal Reserve is expected to cut its benchmark Federal Funds target rate to a record-low 0.5% at its policymaking Federal Open Market Committee meeting tomorrow (Tuesday), the European Central Bank (ECB) is signaling a reluctance to drop its key rate below 2.0%.Since the Euro-region slipped into a recession in October, the ECB has cut its main interest rate by 175 basis points to 2.5%. However, the bank’s policymakers, led by ECB President Jean-Claude Trichet, are now sounding calls for more fiscal discipline.Investors are betting that the ECB will be forced to shave another 50 basis points off its benchmark rate in January, but ECB council member Axel Weber warned last week that the bank “would like to avoid” taking it below that level.“We should be cautious when our [+]

Jim Davidson asked: On September 19, the SEC suspended short selling for 799 financial companies to “protect the integrity and quality of the securities market and strengthen investor confidence“. Since then the Dow has lost 165 points. The ban ends tomorrow.Eric Roseman says the legislation targets the wrong traders. Short sellers make the market more transparent. By blocking them, the SEC is violating the free market.The ban has so far failed to stabilize the markets. Don’t be surprised if the government now moves to target other safe havens such as gold and offshore accounts. Eric recommends investors move quickly to secure their assets in European strongholds like Switzerland and Liechtenstein.This from The Sovereign Society:By targeting and banning short-sellers, the SEC is barking up the wrong tree and removing one of the last market-based sanctuaries [+]

Money Morning asked: After U.S. Federal Reserve policymakers meet today (Monday) and tomorrow (Tuesday), most experts expect a half a percentage point cut in the benchmark Federal Funds Rate – which is already 1.0%.That doesn’t leave members of the central bank’s policymaking Federal Open Market Committee (FOMC) much room to maneuver. Still, the policymakers may have more ammunition in their arsenal and the statement that accompanies the rate decision at the end of the two-day session could shed some insight on the “creative” actions the Fed could consider in addition to rate cuts (For instance, the central bank could extend the new investment firm discount window, offer additional loan guarantees, or utilize any number of other tools).And the Fed may well have to use those other tools. As Japan’s “Lost Decade” demonstrated, “zero” interest [+]

Vritika Ray asked: Positive global cues and hopes of another sector-specific stimulus package and tax sops by the government in this year’s interim budget helped the Indian stock market regain some of its early week losses for the week of February 2-6. Renewed concerns about the prevailing economic conditions in the US and continued selling pressure from FIIs weighed heavy on key benchmark indices as the Sensex witnessed a fall of 123.38 points for the week ended February 6. In Sensex news, out of the five trading sessions, markets remained in positive territory for three days. In Sensex today, a large number of madcap and smallcap stocks posted handsome gains. Clearly reflecting the investors’ mood over these counters, Smallcap and Midcap indices inched 1.43 pr cent and 1.05 per cent higher respectively. Among the [+]