World stocks soar as EU leaders reach debt deal

AP and AFP

LONDON/HONG KONG — World stock markets surged Thursday as bank shares rocketed and the euro hit a seven-week high against the dollar after EU leaders struck a crucial deal to solve the eurozone debt crisis. European equities rose by between 2.0 and 5.0 percent after strong gains for Asian shares, while the euro topped US$1.40 for the first time since early September.

“Stocks have had a stunning start to the day, and Europe’s troubled banking sector is staging a broad-based rally,” said Kathleen Brooks, an analyst at traders “Decisions have been made in Europe, and even if we are short on detail Europe’s leaders are talking the right game and the markets seem to like it.”

In European midday deals, London’s benchmark FTSE 100 index jumped 2.28 percent to 5,553.60 points, Frankfurt’s DAX 30 soared 3.93 percent to 6,253.58 points and in Paris the CAC 40 rallied 4.26 percent to 3,304.93 points. Wall Street also headed toward gains, with Dow Jones industrial futures rising 1.6 percent and S&P 500 futures gaining 1.8 percent. European leaders on Thursday sealed a last-ditch deal to fix its festering debt crisis by shoring up its bailout fund, pledging new funds for Greece and pushing banks to share the pain at a summit vital to the health of the global economy. Banking shares rocketed in response, with Deutsche Bank up nearly 16 percent to 32.87 euros in Frankfurt and BNP Paribas rising 15 percent to 34.64 euros in Paris. In London, Barclays advanced 12 percent at 200 pence, while Britain’s bailed-out lender Royal Bank of Scotland gained more than eight percent. Regional Markets

Asian markets surged on Thursday as European leaders announced a deal to tackle the region’s crippling debt crisis, easing worries about a fiscal meltdown plunging the world economy into a recession. News of the last-ditch deal also sent European markets soaring in early trade and the euro to a seven-week high against the dollar, while drawing applause from Beijing and Tokyo. Japan said it would take the “necessary measures” to help stabilize the eurozone to protect its own economy, amid reports China and other top emerging economies planned to helped finance the region’s beefed-up bailout fund. Tokyo jumped 2.04 percent, or 178.07 points, to 8,926.54, Seoul added 1.46 percent, or 27.73 points, to 1,922.04, and Sydney closed 2.49 percent, or 105.7 points, stronger at 4,348.2. Hong Kong rallied 3.26 percent, or 622.16 points, to 19,688.70, while Shanghai ended 0.34 percent, or 8.13 points, up at 2,435.61. Sydney was closed for four hours soon after opening due to a technical glitch. In Tokyo, Olympus shares surged more than 22 percent, one day after the camera maker’s under-pressure chairman and president resigned over a fee payments scandal. The firm had lost more than 50 percent of its value since the sacking earlier this month of its British chief executive after he raised doubts over advisory fees tied to a series of buyouts. By 1105 GMT, gold was up at US$1,720.39 an ounce, against US$1,717.35 earlier Thursday. In other markets: — Manila closed 1.01 percent, or 42.74 points, higher at 4,267.50. Philippine Long Distance Telephone added 2.5 percent to 2,388 pesos while Metropolitan Bank and Trust rose 1.7 percent to 69.05 pesos.