Stock prices rise as Egypt's crisis eases
Stock prices climb Monday in Asia and Europe. Stock prices expected to rise in the US.
LONDON — World stock markets started the week higher on Monday amid signs that the turmoil in Egypt was easing after days of anti-government unrest. Investors were focusing on earnings reports and Europe's pledge to boost its fight against the debt crisis.
In Egypt, government officials met Sunday with some opposition leaders in an effort to negotiate an end to nearly two weeks of protests that came close to toppling the government and put a cloud over financial markets.
As those tensions eased, stock markets in Asia and Europe edged higher. Britain's FTSE 100 rose 0.8 percent to 6,047.47. Germany's DAX was up 0.9 percent to 7,281.02, and the CAC-40 in Paris climbed 1.2 percent to 4,093.86.
The Egyptian pound slumped 1.5 percent as banks reopened, though the stock market remains shut. In two days of trading the week before last, it fell around 17 percent as the protests unfolded in the Arab world's most populous nation.
In Europe, government leaders on Friday vowed to increase the size and powers of their $1 trillion bailout fund. Germany and France also called on all 17 euro nations to adopt a string of reforms to make their economies more competitive.
However, both the details of the bailout fund's enlargement and the reforms pact are expected to take weeks of negotiations. The reforms in particular are likely to jangle some countries' nerves, as they touch on sensitive topics such as salary increases, welfare benefits and banking regulation.
To highlight the difficulties of painful reforms, a week of protests by Portuguese public transport workers started Monday in protest against government austerity measures. Greece has been hit regularly with such strikes and Ireland is facing an election, where fiscal austerity and the possible renegotiation of the government's bailout terms will feature prominently.
Although the euro has rallied in recent weeks on hopes that EU leaders will come up with a grand solution to the crisis, it eased back last week as it became apparent that political disagreements remain rife and few concrete announcements will come before next month at the earliest. On Monday it traded at $1.3577, down from $1.3587 late Friday in New York.
Stock markets gains were limited Monday as poor U.S. jobs figures released Friday kept investor sentiment in check.
The Labor Department said that only 36,000 new jobs were created last month, the fewest in four months. Despite a drop in the official unemployment rate, the slow job growth left some analysts doubting that the economic recovery is gathering momentum.
In Asia, indexes were helped higher by upbeat earnings reports released after the close on Friday.
The Nikkei 225 stock average rose 0.5 percent to close at 10,592.04, with Hitachi Ltd. up 2.3 percent and Mitsubishi UFJ Financial Group Inc. up 1.6 percent as traders welcomed their quarterly figures.
South Korea's Kospi rose 0.5 percent to 2,081.74. Markets in India and New Zealand also advanced whilestocks in Thailand, Indonesia and Singapore sank. Indexes in mainland China and Taiwan remained closed for Lunar New Year holidays.
Hong Kong's Hang Seng index dropped 1.5 percent to 23,553.59 amid anxiety over whether China will soon hike interest rates to stem inflation. Analysts had predicted a hike before the holiday but then put such speculation on hold as angry street protests in Egypt picked up steam.
Benchmark crude for March delivery was down 9 cents at $88.94 a barrel in electronic trading on the New York Mercantile Exchange. The contract lost $1.51 to settle at $89.03 on Friday.