Tuesday, July 17, 2018
News: Page (1) of 1 - 11/29/11 Email this story to a friend. email article Print this page (Article printing at MyDmn.com).print page facebook
Markets still buoyed by euro rescue hopes
Markets still buoyed by hopes Europe will come up with euro rescue plan
By The Associated Press

LONDON (AP) ' Markets were boosted again on Tuesday by hopes that the 17 countries that use the euro will finally come up with a plan to deal with their crushing debt crisis.

As the 17 finance ministers of the countries that use the euro converged on EU headquarters in a desperate bid to save their currency ' and to protect the global economy from a debt-induced financial tsunami ' investors were reminded of the urgency of the task at hand.

Italy's borrowing rates shot up Tuesday to above 7 percent, an unsustainable level on a par with rates that forced the others to seek bailouts.

The fear is that the crisis ' which already has forced bailouts of Greece, Ireland and Portugal ' could engulf bigger economies such as Italy, the eurozone's third-largest. If Italy were to default on its debt of euro1.9 trillion ($2.5 trillion), the fallout could spell ruin for the euro project itself and send shock waves throughout the global economy.

Though no specific details have yet emerged of what will likely result from a Dec. 9 summit of EU leaders, the ministers are thought to be discussing ideas that would have been taboo only recently: countries ceding fiscal sovereignty to a central authority; some kind of elite group of euro nations that would guarantee one another's loans ' but require strong fiscal discipline from anyone wanting membership.

On Tuesday, finance ministers also were likely to discuss the options ' plus a possible way to boost the region's rescue fund, the European Financial Stability Facility, at a meeting in Brussels.

"Global equity markets have started the week hopeful that EU policymakers are actually moving closer to resolving the eurozone debt and banking crisis, with hopes pinned on reports that France and Germany are planning a 'fast-track' updated Stability Pact to both tighten budget rules and provide fiscal policy oversight," said Neil MacKinnon, global macro strategist at VTB Capital.

On Monday, stocks advanced strongly, particularly in Europe, with the CAC-40 in France up a massive 5 percent or so.

As a result, the gains Tuesday were not as marked but did provide some further evidence of the hopes that European leaders will finally get their act together in around 10 days time.

In Europe, Germany's DAX was up 0.2 percent at 5,747, while the CAC-40 rose 0.5 percent at 3,026. The FTSE 100 index of leading British shares was 0.1 percent higher at 5,320. The euro, meanwhile, was up 0.4 percent at $1.3346.

Wall Street was poised for further gains, too, amid ongoing evidence of a strong start to the U.S. holiday shopping season. Dow futures were up 0.5 percent at 11,555, while the broader Standard & Poor's 500 futures rose 0.6 percent at 1,198.

Earlier, most Asian markets ended higher, with the Nikkei 225 index in Tokyo climbing 2.3 percent to close at 8,477.82.

Elsewhere in Asia, South Korea's Kospi rose 2.3 percent to 1,856.52 and Hong Kong's Hang Seng added 1.2 percent to 18,256.20. Benchmarks in Singapore, Taiwan and Australia were also higher.

Mainland Chinese shares advanced, with the benchmark Shanghai Composite Index gaining 1.2 percent to 2,412.39.

Oil prices tracked equities modestly higher ' benchmark crude for January delivery was up 49 cents to $98.70 per barrel in electronic trading on the New York Mercantile Exchange.


Pamela Sampson in Bangkok contributed to this report.

Page: 1


Our Privacy Policy --- About The U.S. Daily News - Contact Us - Advertise With Us - Privacy Guidelines