Debt crisis: Strong US stock gains drive world shares higher
Published 11/08/2011 | 14:59
Better-than-expected unemployment statistics from the US and dwindling fears about European banks and sovereign debt drove stock markets higher this afternoon, at least temporarily.
US initial unemployment benefit claims fell more than expected to a four-month low, new figures showed.
This boosted investor sentiment about the US economy and, in turn, European shares, in what had been a volatile day.
US stocks rose more than 2pc in early trade and were helped by a rebound in some European stocks in afternoon trade.
The Dow Jones industrial average rose 285.66 points, or 2.6pc, at 11,005.60 while the Nasdaq Composite Index was up 3.3pc at 2,459.41.
Stocks tumbled yesterday on rumours of a France credit rating downgrade, which was later denied, and worries over the Greek debt exposure of French bank Société Générale.
French President Nicolas Sarkozy and German Chancellor Angela Merkel are set to meet next week to discuss eurozone sovereign debt and other issues.
London’s FTSE 100 closed 156 points, or 3pc, higher at 5,163 – the index had dropped below the 5,000 barrier early in the day.
The CAC-40 index in Paris closed up 2.9pc while the DAX in Frankfurt gained more than 3pc.
Meanwhile, the dollar and euro also gained after market factored in a pegging between the Swiss franc and the euro to rein in the soaring currency which investors have been fleeing to as a safe haven along with gold.
(Additional reporting Press Association)