A roundup of trading on major world markets:
NEW YORK – US stocks rallied sharply Monday as investors saw positive signs in European efforts to find a way to resolve the eurozone debt crisis.
The Dow Jones Industrial Average rose 272.38 points (2.53 per cent) to finish at 11,043.86.
The broader S&P 500 advanced 26.52 point (2.33 per cent) to 1,162.95, while the tech-heavy Nasdaq Composite added 33.46 points (1.35 per cent) to 2,516.69.
US stocks had opened higher after their worst week in three years, finding support after European markets began the week in rally mode on hopes that policymakers would be able to ring-fence the eurozone from contagion from Greece’s debt crisis.
But Wall Street momentum faded, only to gather a burst of buying late in the session.
The bond market fell Monday. The 10-year Treasury bond yield rose to 1.90 per cent from 1.86 per cent on Friday, while the 30-year bond increased to 3.00 per cent from 2.93 per cent.
Bond prices and yields move in opposite directions.
LONDON – European shares rebounded amid intense speculation over a banking recapitalisation plan and an orderly Greek default, at the start of a critical week for the eurozone.
But following weekend G20 talks, the euro was further pressured by the eurozone debt crisis and growing signs it could further damage the faltering global economy.
In late morning trading, the London stock market added 0.42 per cent, Paris advanced 1.84 per cent and Frankfurt jumped 2.09 per cent. Italian and Spanish shares rose by about 3.0 per cent.
All three markets had fallen sharply at the open, but rallied on speculation that the French government was drawing up plans to recapitalise the country’s ailing banks, amid persistent worries over their exposure to Greece.
The euro sank to $US1.3363, hitting the lowest point since January in early morning London deals, and hit another 10-year low at 101.94 yen in Asian trade.
Shares were also boosted after German business confidence data came out better than expected and by the prospect that the eurozone may finally implement a July accord on boosting its bailout fund for debt-plagued member nations.
Greece faces a tough week as European Union (EU) and IMF experts resume an audit of progress on cutting the public deficit and reforming the economy.
The EU and IMF will decide on the basis of the audit whether to release the next slice of rescue funds of eight billion euros ($A11.08 billion) from a first bailout in May last year.
Without this money, Greece will be unable to pay its current bills from about the middle of October.
HONG KONG – Asian markets tumbled and the euro fell against the greenback as anxious traders fear European leaders will not be able to find a solution to the region’s debt crisis.
Tokyo fell 2.17 per cent, or 186.13 points, to 8,374.13, Seoul shed 2.64 per cent, or 44.73 points, to 1,652.71 and Sydney ended 1.01 per cent, or 39.3 points, off at 3,863.9.
Hong Kong shed 1.48 per cent, or 261.03 points, to 17,407.80, while Shanghai ended 1.64 per cent, or 39.98 points, lower at 2,393.18.
Bangkok shed 5.65 per cent, or 53.10 points, to end at 904.06.
The losses extended those from last week, when some global indexes were sent tumbling to multi-year lows because of the ongoing European crisis as well as concerns over US economic growth.
The euro slumped to $US1.3461 in Tokyo afternoon trade from $US1.3503 late Friday in New York while it also hit Y102.90 from Y103.31. The single currency was, however, up slightly from the 10-year-low Y101.94 seen earlier.
The US dollar was slightly lower at Y76.40 compared with Y76.50.
The greenback also extended gains against the commodities-linked Australian dollar. The Aussie – which just over two months ago hit a record above $US1.10 – slid to 97.53 US cents late in the session, down from 98.34 cents on Friday.
Singapore ended 1.65 per cent, of 44.49 points, off at 2,654.31.
Singapore Telecom rose 0.98 per cent to Sg$3.09 while Keppel Corp fell 3.59 per cent to Sg$8.05.
WELLINGTON – Wellington closed down 0.83 per cent, or 27.34 points, at 3,255.37.
Telecom dived 5.3 per cent to $NZ2.50 and Contact Energy fell 2.4 per cent to $NZ5.38.
