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Global markets rebound; caution over US economy data

Tuesday, March 6th 2007 - 21:00 UTC
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Stock markets around the world rebounded on Tuesday after five days of losses but concerns over volatility remain. In Latinamerica major stock markets followed on the world reaction with Sao Paulo soaring almost 5%.

In United States the Dow Jones Industrial Average ended 1.3% up while the Standard & Poor's 500 rose 1.5% and the Nasdaq gained 1.9%. The climbs echoed rises in Europe and Asia, and come a week after events in China and doubts about the US economy triggered world stocks to slide. The benchmark Dow Jones managed to recover about a quarter of its losses seen over the past week, after the global slump prompted by a 9% market fall in China last week. But Tuesday's market rise came even as US economic data signaled the world's largest economy was slowing. US Labor Department showed lower than expected productivity for the last three months of 2006, while the Commerce Department figures revealed a sharper-than-forecast drop in factory orders for January. Equity markets have suffered heavy losses in recent days, after investors dumped stocks amid concerns that they were overvalued and that economic growth could slow. Furthermore there's growing concern over the US mortgage market. Analysts believe a broader correction in the markets could still take place. The US rebound came after London's FTSE 100 index had ended 1.3% up, while Germany's Dax added 0.9% and France's Cac closed 1% up. Earlier on Tuesday, Japan's Nikkei index, which had lost 8% of its value in the past five sessions, climbed 1.2%, while the Bombay Stock Exchange closed 2.3% higher at 12,697. Hong Kong's Hang Seng index climbed 2.1%, while the main indexes in Australia and China put on 2%. In Latinamerica Brazil's Bovespa climbed 4.76%; Argentina's Merval 3.1%; Chile's IPSA 2% and Mexico BVM, 2.2%.

Categories: Economy, International.

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