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The outlook for U.S. stock markets improved dramatically Wednesday morning after the Federal Reserve and European central bankers announced a coordinated emergency rate cut.

The Federal Reserve reduced its benchmark discount rate by 0.5 percent to 1.5 percent. The European Central bank reduced its benchmark to 3.75 percent and the Bank of England cut its benchmark to 4.5 percent. Canada, Sweden, and Switzerland also reduced rates. In a joint statement, the central bankers said they were taking the acting because “the recent intensification of the financial crisis has augmented the downside risks to growth.”

Futures on the Standard & Poor’s 500 Index jumped to a 24.10 point gain to 1,029.90 at 7:02 a.m., two minutes after the Fed’s announcement. Dow Jones Industrial Average futures were up 512 points to 9,690 (payday loan).00 and Nasdaq 100 futures were up 27.25 points to 1,364.25.

Prior to the Fed’s announcement, the S&P 500 futures contract had tumbled as much as 43 points on the heels of steep declines overseas. The Nikkei 225 declined more than 9 percent on the Tokyo Stock Exchange as investors fretted about a global recession and the S&P 500 Index below the 1000 level for the first time in five years Tuesday.

European stock markets rebounded swiftly; nearly erasing loses of as much as 5 percent. The FTSE 100 Index was down 20 points, or 0.24 percent, to 4585.11 on the London Stock Exchange at 7:06 a.m.

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A N.Y. judge has put a temporary hold on Wells Fargo & Co.’s proposed $15.1 billion buyout of Wachovia Corp., Citigroup announced Saturday night.

Judge Charles Ramos of the N. Y. Supreme Court has ordered Wachovia (NYSE:WB) to court on Friday. He will hold a hearing on whether the Wells deal violates Wachovia's earlier agreement to sell its banking operations to Citigroup for $2.16 billion.

Until then, his order issued stops Wachovia and Wells from consummating the deal.

The Wachovia/Citigroup deal was brokered Sept. 29 with the help of federal regulators. Citigroup (NYSE:C) says it includes an exclusivity agreement that prevents Wachovia from negotiating an acquisition by anyone else.

On Oct. 2, Wachovia announced it negotiated a deal with San Francisco-based Wells (NYSE:WFC). That calls for the sale of the entire bank holding company to Wells for $15.1 billion. The Wachovia board approved that deal last Friday.

Wells has insisted there is no bar to its deal with Citigroup, based in New York (fast cash). Now Ramos has called Wachovia into court to defend that position.

The court records were not available Sunday morning. But Citigroup says Wachovia objected to the proceedings and attempted to head off the order.

Citigroup says it is prepared to resume its negotiations to buy most of Wachovia’s assets. Some parts of the bank, such as Wachovia Securities, are not part of that deal, which involves financial guarantees from the Federal Deposit Insurance Corp. The proposed Wells deal would include no such guarantees.

Citigroup says it has been providing funds to Wachovia to preserve its liquidity since the Sept. 29 agreement. It says it was completing the requirements of the deal when Wachovia made its surprise announcement late last week.

Wachovia officials could not be reached for comment.

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U.S. District Court Magistrate Judge Timothy Black has granted class-action status to a 2005 lawsuit filed against Fifth Third Bancorp officials, including members of its board of directors, alleging that they mismanaged the company’s employee retirement plan by investing in Fifth Third stock.

The lawsuit was filed by Conn.-based law firm Scott+Scott on behalf of all plan members from September 2001 to the present. It also claims that Fifth Third officials breached their fiduciary duties by charging the plan excessive investment management fees, including by double- or triple-dipping by investing plan assets in Fifth Third’s family of mutual funds through Fifth Third investment affiliates. Fifth Third and the individual defendants have denied the allegations (instant payday loan).

The lawsuit has been split into two for trial purposes, one to consider claims related to the company’s internal controls following its acquisition of Old Kent Financial in 2001 and the other to consider the excessive fees allegations. The former trial is set to begin next March; the latter in September.

Fifth Third and its employees are being defended by lawyers at Keating Muething & Klekamp. Most of the outside directors are being represented by lawyers at the Cincinnati office of Vorys Sater Seymour & Pease.

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The European Central Bank on Thursday signaled it might cut interest rates for the first time in five years as credit strains paralyzed money markets.

Interbank lending rates extended their upward march, reflecting tightness in credit markets, while a sharp fall-off in U.S. commercial paper issuance indicated businesses were having an extremely difficult time raising short-term capital.

ECB President Jean-Claude Trichet, speaking after the central bank left rates unchanged, highlighted further risks to the European economy from the credit crunch, suggesting the once inflation-leery official was warming to the idea of bringing rates down from the current 4.25 percent.

Trichet said ECB policy-makers recognized “the extraordinary high level of uncertainty stemming from latest developments” on turbulent financial markets and the credit crunch. “Economic activity in the euro area is weakening with contracting domestic demand and tighter financing conditions,” he said.

“The ECB is adopting a substantially softer tone, which opens the door for a future interest rate cut,” said Howard Archer, chief European economist at Global Insight.

The Wall Street Journal reported that U.S faxless payday advance. Federal Reserve officials are weighing further interest rate cuts, even if Congress approves a $700 billion financial industry bailout, because of a worsening economic outlook.

A rate cut is still far from certain, partly because of inflation worries, the WSJ said in an unsourced report on its website.

The change in the ECB’s tone reflected a rapid deterioration in the global credit situation. The year-long crisis has seen the downfall of such staple corporate names as Lehman Brothers and AIG, and bank failures have become frequent. 

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The Federal Trade Commission has granted early termination to the waiting period for Napster's deal to sell itself to Best Buy Co. Inc., according to a filing Napster made with the Securities and Exchange Commission Thursday.

The $121 million deal announced Sept. 15, which values Los Angeles-based Napster (NASDAQ: NAPS) at $2.65 per share, was granted early termination of the waiting period on Sept. 30, according to the SEC filing.

Through the deal, "Best Buy intends to use Napster's capabilities and digital subscriber base to reach new customers with an enhanced experience for exploring and selecting music and other digital entertainment products over an increasing array of devices," said Richfield, Minn.-based Best Buy (NYSE:BBY) president and chief operating officer Brian Dunn when announcing the deal Sept payday advance. 15.

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