European shares rebound after Wall Street gain (Lead)

October 17th, 2008 - 5:56 pm ICT by IANS  

Frankfurt, Oct 17 (DPA) A tumultuous trading week on global share markets was drawing to a close with European bourses rebounding Friday following a late surge on Wall Street and despite a mixed performance by stocks across Asia.After closing down five percent Thursday, Europe’s blue-chip Stoxx 50 edged up 1.4 percent to 2,165 in late morning trading Friday.

Europe’s leading stock market in London gained 1.2 percent in pre-lunch trading, while Paris’s CAC 40 index also rose 1.2 percent after jumping 4.37 percent shortly after opening.

In the meantime, shares in Frankfurt fell into negative territory after rising more than 4 percent in early trading as the German parliament’s bank rescue package made its way through parliament. By late morning Frankfurt’s DAX index stood at 4619, down 0.1 percent.

At the same time, oil rose Friday from a 15-month low of under $70 a barrel, increasing 1.6 percent to $73.38 a barrel. Still, oil is about 50 percent lower than its peak.

The element of calm that emerged on European bourses Friday came at the end of turbulent week with share indexes charging ahead Monday in the wake of optimism created by the release of the coordinated government crisis management plans.

But by mid-week recession fears and growing worries about the outlook for corporate earnings sparked another big sell share off around the world with the Tokyo stock market chalking up its largest fall since the 1987 share market crash.

After seesawing its way through Thursday, the New York Stock Exchange closed up 4.7 percent.

However, Asian markets reacted cautiously to the big swings on Wall Street unsure whether Wall Street would be able to sustain the rally.

While Tokyo’s Nikkei 225 closed up 2.78 percent, Hong Kong shares fell 4.4 percent to record their third-consecutive day of heavy losses.

Shares on the Seoul stock exchange also fell by 2.7 percent on recession fears. Stocks in Shanghai rose by 1.08 percent.

Key markets in Central Europe also remained unconvinced by Wall Street’s close with Warsaw sinking by 2.35 percent in early trading, Prague slipping 2 per cent and Moscow slumping by 4.46 percent.

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