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30.04.09 World markets higher on rising economic hopes
LONDON: World stock markets rose Thursday on mounting hopes the global downturn was stabilizing, though investors remained wary as the World Health
Organization warned a swine flu pandemic was imminent.
By mid afternoon London time, the FTSE 100 index of leading British shares was up 76.48 points, or 1.8 percent, at 4,266.07 while Germany's DAX rose 100.71 points, or 2.1 percent, to 4,805.27. The CAC-40 in France was 61.94 points, or 2 percent, higher at 3,178.88.
And Wall Street opened higher. The Dow Jones industrial average was up 81.32 points, or 1 percent, at 8,267.05 while the broader Standard & Poor's 500 futures rose 9.58 points, or 1.1 percent, to 883.22.
The gains around the world really kicked off when the U.S. Federal Reserve said Wednesday that the recession had eased slightly since its last meeting in mid-March.
Stock markets usually rally around six to nine months before real evidence of an economic recovery.
Further hopes about an economic recovery were fueled with the news that initial jobless claims in the US fell last week by 14,000 to 631,000, confounding expectations for an increase.
Not all the US news was positive though, with continuing jobless claims up at a new record, and the government also reporting a slightly larger-than-expected decline in personal spending and incomes.
Despite the improving sentiment at the moment, investors remain wary of calling an end to the bear market, though at the moment the buyers were in the ascendancy.
"Nothing appears to be able to dent the positive market sentiment currently, as highlighted by the continued recovery in equity markets,'' said Hans Redeker, an analyst at BNP Paribas.
The gains Thursday came despite the World Health Organization's decision to raise the alert over swine flu to level five, one short of it declaring a global pandemic. A number of countries have confirmed cases of the disease, which is blamed for roughly 170 deaths and 2,955 infections in Mexico.
Fears about the spread of the deadly virus from Mexico had been a big driver in the markets earlier in the week.
"The chance that the recent outbreak of swine flu develops into a global pandemic provides an obvious risk of a global economic setback,'' said Philip Shaw, an economist at Investec Securities.
Earlier, Asian stocks enjoyed a very strong session. Japanese investors returned from a holiday Wednesday ready to buy, and pushed the Nikkei 225 stock average up 334.49 points, or 3.9 percent, to 8828.26. Hong Kong's Hang Seng rose 564.04 points, or 3.8 percent, to 15,520.99.
Elsewhere in Asia, South Korea's Kospi added 2.3 percent to 1,369.36. Taiwan's market led the region, with its benchmark soaring 6.7 percent, after the government said it will allow institutional investors from China to buy into the island's stock market for the first time since the two sides split in civil war decades ago.
Taiwan's decision late Wednesday is the first step in a wide-ranging financial cooperation program it is launching with the mainland, an often hostile rival dating from a 60-year-old civil war.
China's benchmark edged up 0.4 percent, while Australia's index rose 2.3 percent and Singapore's stock measure added 3.3 percent.
The buying is expected to continue at the U.S. open. Dow futures were up 130 points, or 1.6 percent, to 8,255 while the broader Standard & Poor's 500 futures rose 14.60 points, or 1.7 percent, to 883.70.
http://timesofindia.indiatimes.com/Business/International-Business/World-markets-higher-on-rising-economic-hopes/articleshow/4468913.cms
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05.08.10
