LONDON, Nov 14: European stocks rebounded strongly on Wednesday after Asian and US share prices fought back from heavy losses linked to concerns over the global credit squeeze.
Financial markets have gained some strength back... all led by financials, noted ABN Amro analyst Daniel Snowden.
In morning trade, London’s FTSE 100 index of leading companies jumped 1.54 per cent to 6,460.20 points, with banking giant HSBC up 3.44 per cent despite a sharp rise in US bad debts linked to the subprime loans crisis.
Frankfurt’s DAX 30 gained 0.88 per cent to 7,846.42 points and in Paris the CAC 40 advanced 1.50 per cent to reach 5,621.91.
The European single currency stood at $1.4687.
Asian stocks were sharply up across the board Wednesday as the region welcomed the rebound on Wall Street, where good news on the mortgage crisis and a drop in crude prices helped calm the market, dealers said.
There’s quite a bit of action at the top end of the market with not many areas being left behind, said David Land, an equities analyst at CMC Markets in Australia.
The strong performance in Asia came after Wall Street roared back overnight after four rocky sessions, with the Dow adding 2.46 per cent and the tech-heavy Nasdaq gaining 3.46 per cent.
The Wall Street turnaround came after days of sell-offs linked to worries that banks could still have some subprime skeletons in the closet.
Investors were cheered as Goldman Sachs indicated it would not incur significant charges from the subprime crisis, while oil’s fall below $94 a barrel and strong third-quarter profits from Wal-Mart also eased nerves.
What we are seeing is mostly a knee-jerk reaction to Wall Street’s ending its recent streak of losses in a quite dramatic manner, said Michael Hsu, assistant vice president at Taiwan Life Asset Management.
Rebound is a fitting description because nothing fundamental has changed much, Hsu said, noting that Wall Street had pulled down regional markets along with it previously.—AFP
