MOSCOW ? Stock markets rebounded Wednesday as renewed optimism over the state of the U.S. economy and fresh Chinese policy easing supported sentiment despite the failure of European finance ministers to announce radical new measures to deal with the crippling debt crisis afflicting the 17-nation eurozone.
Sentiment was dampened in the early part of the European session by the failure of eurozone ministers in Brussels on Tuesday to push forward radical plans to help calm market jitters over a debt crisis that's already seen three relatively-small countries get bailed out and is threatening much bigger Spain and Italy.
A decision on how to forge a closer fiscal union between the 17 eurozone countries will have to wait until the leaders' summit next week.
The ministers did agree to hand out euro8 billion ($10.7 billion) to Greece as part of its bailout to stem an immediate cash crisis, but they kicked more difficult issues ? such as whether countries should cede some control over their finances to a central European authority ? to the leaders of the European Union who meet next week.
Stocks have been relatively buoyant this week on expectations that the 17 countries that use the euro will finally come up with a plan to deal with their crushing debt crisis. Those hopes remain generally.
Buoyant U.S. consumer confidence figures on Tuesday also raised hopes that the world's largest economy is faring better than expected. A raft of economic data over the rest of the week will be closely eyed, not least Friday's nonfarm payrolls figures, which often set the market tone for a week or two after their release.
"With the longer term outlook for the U.S. economy becoming increasingly bullish, expectations are for a robust set of numbers to be seen in the days ahead," said Ben Critchley, sales trader at IG Index.
Sentiment was also supported by the news that China reduced bank reserve levels Wednesday to release money for lending and help shore up slowing growth. Higher growth in China could be crucial for a global economy that's suffering in the wake of the eurozone debt crisis.
Beijing announced that thye amount of money China's commercial lenders must hold in reserve will be cut by 0.5 percent of their deposits, effective Dec. 5, the central bank said. It was the first easing of monetary policy in three years and analysts said was unlikely to be the last.
"This is likely to be the first of a series of easing manoeuvres from China, though they'll probably unfold over an extended period," said Benjamin Reitzes, an analyst at BMO Capital Markets.
Beijing is gradually easing controls imposed to cool an overheated economy and politically dangerous inflation. Chinese leaders worry economic growth that eased to 9.1 percent in the quarter ending in September from 9.5 the previous quarter might fall too abruptly, leading to job losses and possible unrest.
Hopes over the number one and two economies in the world helped markets in Europe recoup early losses.
The FTSE 100 index of leading British shares was up 0.8 percent at 5,379 while Germany's DAX rose 1.5 percent to 5,887. The CAC-40 in France was 0.9 percent higher at 3,052.
The euro meanwhile was down 0.1 percent at $1.3304, after figures showing inflation in the eurozone at a stubbornly-high level of 3 percent ? a full percentage point above the European Central Bank's target ? and a further uptick in the unemployment rate to 10.3 percent.
Wall Street was also headed for a higher opening on Wednesday following the previous session's gains. Dow futures rose 0.6 percent to 11,630 and S&P 500 futures were up an equivalent rate to 1,204.
Earlier, Asian stocks closed lower on Wednesday. Japan's Nikkei 225 index dropped 0.5 percent to close at 8,434.61. South Korea's Kospi dropped 0.5 percent to 1,847.51. Hong Kong's Hang Seng dipped 1.5 percent to 17,989.35.
___
AP business writer Pamela Sampson from Bangkok and AP researcher Fu Ting from Shanghai contributed to this report.
steve jobs commencement speech sarah palin espn body issue ijustine visionary guy kawasaki jani lane
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.