With breaking news across the wires is that following the US Federal Reserve's announcement that has slashed the base interest rate to 4.75% ( a drop of half a point ), the FTSE gained a 2% rise. The knock on affect of this bold move by the US Reserve will be to apply further pressure on the Bank of England to follow suit and lower the UK interest rates further.
Northern Rock's share prices were not buoyed by this news, falling a further 10% with the news that the group had been valued by interested parties at under a billion pounds.
Martin Lewis, of consumer Web site MoneySavingExpert.com, said: "People queuing outside Northern Rock to withdraw savings need to calm down."
He said it was "enormously, unthinkably unlikely" that the bank would go bust.
In that event, savers would be protected by the Financial Services Compensation Scheme, which pays out up to 31,700 pounds per saver should a company cease trading.
An interesting comment also from Moneysavingexpert was that, any takeover of Northern Rock would lead to two things : " any new company taking over Northern Rock would have an immediate necessity to strengthen the brand and this could only be accomplished by both cutting interest rates on borrowing and raising rates for savers, both of which should be of great benefit to existing borrowers/ investors.
The market is in flux at the moment that is sure, many people, not just Northern Rock investors are keeping a close eye on market fluctuations as their mortgages are the most important investment they have.
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