News / Economy

European Markets Bounce Back After Volatile Trading

Traders at the Saxo Banque study their screens in their offices in Paris, August 10, 2011
Traders at the Saxo Banque study their screens in their offices in Paris, August 10, 2011

European stock markets fell in early trading Thursday, largely on concerns about the fiscal health of the continent’s banks. But the markets bounced back in the afternoon, after French and German leaders scheduled an emergency summit to address the euro zone’s debt crisis.

It looked like another day of heavy losses on European markets, following drops in key Asian stock indexes.

But the trend was reversed in the early afternoon.

Analysts said investors took some comfort from news that French President Nicolas Sarkozy and German Chancellor Angela Merkel are to meet next Tuesday to discuss the continent’s debt situation.

Even with those late-day gains, during the last two weeks the London stock index is down more than 15 percent, and the German and French indexes are down more than 20 percent.

Many concerns

Investors have become increasingly concerned that troubled economies in the euro zone may face further problems meeting their debt payments, and that more countries and commercial banks may be affected by the crisis.

But the move by the two key European leaders to increase their personal involvement in trying to ease the situation provided enough confidence to turn stock prices around.

At the London School of Economics, Professor Iain Begg says decisive action by national leaders is exactly what is needed to address the debt crisis and the resulting impact on stock markets, bank confidence and economic growth.

“If we set too much store by one day’s movement, or even a few hours movement in the markets, we’d end up spending so much time gazing at our own navels that we wouldn’t be able to work out what’s really going on," said Begg. "And I think that what the politicians have been given is a warning sign. And now it’s up to the politicians to act much more decisively and cohesively. If they do that, then this froth in the market will probably go away.”

Lack of confidence

During a debate in the British Parliament Thursday, Finance Minister George Osborne blamed the stock market drops on what he called a lack of confidence in ability of governments to repay their debts. He called for international action to address the situation.

“This is a global as well as a European crisis, and at this autumn’s meeting of the IMF and the G-20 we need far greater progress on global imbalances," Osborne said. "We need an international framework that allows creditor countries like China to increase demand, and debtor countries to make the difficult adjustments necessary to repay them.”

Europe’s Central Bank has already issued guarantees designed to shore up confidence in troubled economies like Italy, Portugal and Greece. But some experts say the continent’s markets will not truly stabilize until there is agreement on issuing European bonds, through which individual countries would be able to borrow money with the full backing of all the euro zone countries

You May Like

Video Obama Announces Plan to Send 3,000 Troops to Liberia in Ebola Fight

At US Centers for Disease Control and Prevention, Obama details troop deployment and other pieces of US plan More

Video China Muslims Work to Change Perceptions After Knife Attacks

Muslims in Kunming say that they condemn the violence, it is not a reflection of the true beliefs of their faith More

Humanitarian Aid, Equipment Blocked in Cameroon

Move is seen as a developing supply crisis in West Africa More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Enviropreneur Seeks to Save the Environment, Empower the Communityi
X
September 16, 2014 2:06 PM
Lorna Rutto, a former banker, is now an ‘enviropreneur’ - turning plastic waste into furniture and fences discusses the challenges she faces in Africa with raw materials and the environment.
Video

Video Enviropreneur Seeks to Save the Environment, Empower the Community

Lorna Rutto, a former banker, is now an ‘enviropreneur’ - turning plastic waste into furniture and fences discusses the challenges she faces in Africa with raw materials and the environment.
Video

Video West Trades Accusations Over Ransoms

As world leaders try to forge a common response to the threat posed by Islamic State militants in Iraq and Syria, there is simmering tension over differing policies on paying ransoms. In the past month, the jihadist group has beheaded two Americans and one Briton. Both countries refuse to pay ransom money. As Henry Ridgwell reports for VOA from London, there is uncertainty in the approach of some other European nations.
Video

Video Scotland Independence Bid Stokes Global Interest

The people of Scotland are preparing to vote on whether to become independent and break away from the rest of Britain, in a referendum being watched carefully in many other countries. Some see it as a risky experiment; while others hope a successful vote for independence might energize their own separatist demands. Foreign immigrants to Scotland have a front row seat for the vote. VOA’s Henry Ridgwell spoke to some of them in Edinburgh.
Video

Video Washington DC Mural Artists Help Beautify City

Like many cities, Washington has a graffiti problem. Buildings and homes, especially in low-income neighborhoods, are often targets of illegal artwork. But as we hear from VOA’s Julie Taboh, officials in the nation's capital have come up with an innovative program that uses the talents of local artists to beautify the city.
Video

Video US Muslim Leaders Condemn Islamic State

Leaders of America's Muslim community are condemning the violent extremism of the Islamic State group in Iraq and Syria. The U.S. Muslim leaders say militants are exploiting their faith in a failed effort to justify violent extremism. VOA correspondent Meredith Buel reports.
Video

Video Americans' Reaction Mixed on Obama Strategy for Islamic State Militants

President Barack Obama’s televised speech on how the United States plans to “degrade and destroy” the group known as the Islamic State reached a prime-time audience of millions. And it came as Americans appear more willing to embrace a bolder, tougher approach to foreign policy. VOA producer Katherine Gypson and reporter Jeff Seldin have this report from Washington.
Video

Video Authorities Allege LA Fashion Industry-Cartel Ties

U.S. officials say they have broken up crime rings that funneled tens of millions of dollars from Mexican drug cartels through fashion businesses in Los Angeles. Mike O'Sullivan reports that authorities announced nine arrests, as 1,000 law enforcement agents fanned out through the city on Wednesday.
Video

Video Bedouin Woman Runs Successful Business in Palestinian City

A Bedouin woman is breaking social taboos by running a successful vacation resort in the Palestinian town of Jericho. Bedouins are a sub-group of Arabs known for their semi-nomadic lifestyle. Zlatica Hoke says the resort in the West Bank's Jordan Valley is a model of success for women in the region.


Carnage and mayhem are part of daily life in northern Nigeria, the result of a terror campaign by the Islamist group Boko Haram. Fears are growing that Nigeria’s government may not know how to counter it, and may be making things worse. More

AppleAndroid

World Currencies

EUR
USD
0.7722
JPY
USD
107.08
GBP
USD
0.6171
CAD
USD
1.1041
INR
USD
61.075

Rates may not be current.