A roundup of trading on major world markets:
NEW YORK – A bit of positive data on the US economy gave stocks a boost Tuesday, as traders brushed off new figures showing stalling European economic growth.
The Dow Jones Industrial Average added 17.41 (0.14 per cent) to 12,096.39 in closing trade.
The broad-based S&P 500 gained 6.02 (0.48 per cent) to 1,257.80, while the tech-heavy Nasdaq Composite rose 28.98 (1.09 per cent) to 2,686.20.
US data released Tuesday showed that retail sales continued to rise in October, helped by a jump in electronics and appliances, while inflation was muted at the wholesale level.
A key manufacturing index for New York also surged to its first positive reading in six months in November, suggesting an upturn in business conditions.
LONDON – European markets moved mostly lower, with investors keeping a wary eye on the eurozone debt crisis as Italian, Spanish and French borrowing costs spiked worryingly higher.
As Italy, Greece and Spain paid sharply higher rates to raise fresh funds, French stocks fell more than two per cent in early trade, with similar losses on other markets while the euro slumped under $US1.36 on worries of further debt contagion.
As Italy’s new leader Mario Monti launched a final round of talks to form a government, the country’s 10-year cost of borrowing jumped back above the danger level of 7.0 per cent.
Meanwhile in Madrid, Spain paid sharply higher rates of more than five per cent at a 3.16 billion euros ($A4.24 billion) bond issue, amid fears that the country would join Greece and Italy in succumbing to eurozone financial instability.
The critically important gap between the rates paid by Germany and France, the two pit props holding up the eurozone, widened to a record 191 basis points or 1.91 percentage points in late afternoon trade, reflecting how investors prefer the safety of German bonds in the current climate.
The French 10-year bond yield – the rate of return earned by investors – rose sharply to 3.683 per cent but the German rate was steady at 1.782 per cent, meaning that France has to pay more than twice as much as Germany to borrow.
In London, the FTSE-100 index of top companies closed virtually unchanged on Tuesday, slipping just 0.03 per cent to 5,517.44 points.
But in Paris the CAC-40 tumbled 1.92 per cent to 3,049.13 points and in Frankfurt the DAX 30 shed 0.87 per cent at 5,933.14 points.
Milan finished down 1.08 per cent, having been firmer in afternoon deals following heavy early losses, while Madrid was down 1.61 per cent.
In foreign exchange deals, the euro fell sharply to $US1.3506 from $US1.3629 in New York late on Monday.
HONG KONG – Asian shares mostly dipped as the previous day’s relief at political progress in Italy and Greece was replaced by caution over whether Europe’s leaders can tame the eurozone debt crisis.
Tokyo slipped 0.72 per cent, or 61.77 points, to 8,541.93, Sydney closed down 0.44 per cent, or 19 points, at 4,285.6, while Seoul lost 0.88 per cent, or 16.69 points, at 1,886.12.
Hong Kong shed 0.82 per cent, or 159.74 points, to 19,348.44 while Shanghai was flat, nudging up 1.05 points to 2,529.76.
Markets rallied on Monday after Italian prime ministerial nominee Mario Monti replaced Silvio Berlusconi. Greece also has a new leader, Lucas Papademos, former deputy chief of the European Central Bank
However, Asian markets fell Tuesday following a sell-off in Europe and the United States as dealers began to consider that despite a change in leadership, Italy and Greece still faced a tough task to implement effective debt measures.
WELLINGTON – Wellington closed 0.2 per cent, or 7.5 points, higher at 3,317.33.
