$586bn stimulus package BY CHINA

The Chinese government kicked off proceedings yesterday when it announced a $586bn stimulus package – equivalent to almost a fifth of its GDP last year – to boost domestic infrastructure spending and stimulate their economy which has dropped to an annualised GDP growth rate of 9%. All the cash will be used up by the end of 2010. Resources outperforming on the back of the news

The Dow was up 248. Up all session – up 265 at best. Market overlooked negative employment data and poor 3Q results – market had already factored in the bad news. Unemployment rocketed to 6.5% with a larger-than-expected fall in payrolls – was up a hefty 0.4% in October from September. President Elect Barak Obama said the US requires a fiscal stimulus plan and a rescue package for the middle class. Ford and General Motors ate through their cash reserves in the 3Q. Bonds down. Gold and metals up moderately. A$ up 1.38% against the US dollar – and up 2.39% this morning to 69.17c.

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