LONDON, May 18: Global stock markets, enduring a grim week, were further shaken on Thursday by news of rising inflation in the United States and the eurozone, sparking concerns about global interest rate increases.

Wall Street had taken a beating on Wednesday after a hotter-than-expected US inflation report reignited investor jitters about higher interest rates, dragging Asian stock markets down in its wake on Thursday.

European shares firmed on Thursday, after stocks in Britain, France and Germany had plunged by more than 2.5 per cent the previous day.

Selling accelerated as the US dollar weakened sharply and as commodity prices fell from record high points.

European markets have enjoyed a very good start to 2006 so they all fell pretty similarly over the past few days, said Barclays stock market analyst Hilary Cook.

Interest rates do seem to be rising pretty sharply and are set to rise further and that could really choke off recovery, she added. In European trading on Thursday, the FTSE 100 index of leading shares added 0.30 per cent to 5,692.70 points, Frankfurt’s DAX 30 increased 0.49 per cent to 5,680.42 points and in Paris the CAC 40 index rose 0.41 per cent to 4,940.64.

The DJ Euro Stoxx 50 index of leading eurozone shares gained 0.65 per cent to 3,628.77 points.

The euro stood at 1.2780 dollars.

London’s FTSE 100 has now shed over 7.0 per cent of its value since closing on April 21 at 6,132.7 points — which had marked the highest finish since February 15, 2001.

The FTSE had enjoyed a strong first half, owing to robust earnings and takeover news, and thanks to record high oil and metals prices.—AFP