A roundup of trading on major world markets:
NEW YORK – US stocks are surging following encouraging signs out of Europe and a jump in apartment building in the US The Dow Jones industrial average jumped more than 300 points. If the gains hold, it will be the best day for stocks this month.
German business and consumer confidence rose unexpectedly in December, and the Spanish government pulled off a successful debt auction. Both helped to ease worries about Europe’s debt crisis.
Borrowing costs for the Spanish government plunged at an auction of short-term debt, a sign that investors are becoming more confident in the country’s ability to pay it back.
Spain raised 5.6 billion euro ($A7.39 billion), much more than its goal of 4.5 billion euro. Investors demanded an interest rate of only 1.74 per cent to lend to the government for three months, a steep fall from the 5.1 per cent at an auction in November.
The Dow Jones industrial average jumped 315 points, or 2.8 per cent, to 12,082 in early afternoon trade. It fell 100 points the day before. Cisco Systems Inc. rose 4.4 per cent, the largest gain of the 30 Dow stocks.
The Standard & Poor’s 500 index gained 33 points, or 2.7 per cent, to 1,238. Only 10 stocks in the index fell.
The Nasdaq composite index rose 74, or 2.9 per cent, to 2,597.
LONDON – European stocks closed sharply higher and the euro got a boost on Tuesday after a series of strong US and German economic data helped ease concerns over the eurozone debt crisis.
Dealers said much better-than-expected German confidence figures provided early support, helped along by a positive Spanish government debt sale which saw Madrid’s borrowing costs fall sharply.
News of a sharp spike in US new housing starts, a key indicator of confidence in the hugely important property market, then drove Wall Street higher, taking the European markets with it.
The euro, on the defensive as the eurozone debt crisis saps support, jumped on the Spanish lead and reports that the Greek government was making progress in talks with private banks on writing down a large part of its debt mountain.
In London, the FTSE 100 index of top companies closed up 1.02 per cent at 5,419.60 points. In Paris, the CAC-40 gained 2.73 per cent at 3,055.39 points and in Frankfurt the DAX 30 jumped 3.11 per cent to 5,847.03 points.
Madrid added 2.44 per cent and Milan rose 2.87 per cent.
HONG KONG – Asian markets were mixed on Tuesday as initial concerns about regional tensions after the death of North Korea’s Kim Jong-Il subsided, although European debt woes continued to drag on sentiment.
With attention turning to the leadership succession in Pyongyang, markets were relieved that there seemed to be no internal turmoil in the nuclear-armed state, providing dealers an opportunity to pick up cheap stocks.
Seoul, which tumbled 3.4 per cent on Monday, rebounded on Tuesday to end 0.91 per cent higher, adding 16.13 points, to 1,793.06.
Tokyo rose 0.49 per cent, or 40.36 points, to 8,336.48 and Hong Kong ended 0.06 per cent, or 9.99 points, higher at 18,080.20.
Regional markets tumbled on Monday after news Kim had died, throwing into uncertainty the future of the isolated communist state, which for years has raised regional tensions with its erratic behaviour and nuclear capability.
WELLINGTON – New Zealand shares fell, pushing the NZX 50 Index to the lowest since early August, in a broad-based sell off led by tapware maker Methven and Fisher & Paykel Healthcare.
The NZX 50 Index declined 21.011, or 0.7 per cent, to 3202.02.
