Markets rally back on hopes of end to Libya conflict

Share markets in Europe have rebounded, led by shares in energy firms, on hopes that fighting in Libya may soon end.

At close on Monday London's FTSE 100 raised  1.08% and the Cac 40 in Paris by 1.14%.Its a good sign for investors.

The rally follows a 5% to 10% slump on most markets on Thursday and Friday on recession fears in the US and Europe.

Oil prices initially down on hopes that Libyan crude would soon come back on tap, before rising again on greater optimism about the global economy.

Fear grips global markets again

World stock markets have continuously suffering heavy losses last week in the first day of trading since rating agency Standard & Poor's downgraded the US late on Friday.

The main Wall Street index, the Dow, was down 2.5% due to weak US economy.The UK's FTSE was 2.9% dowm, and Germany's Dax had fall 4.3%.
But yields on Spanish and Italian bonds fell sharply after intervention by the European Central Bank (ECB).
The ECB said it intended to buy up eurozone government bonds to address concerns that the eurozone debt crisis was spreading to those two countries.
The yield on Spanish 10-year bonds is announced - it indicate of the risk cocerned with lending Spain money down from more than 6% to about 5.2%. Yields on Italian bonds fell by a similar amount.
Tobias Blattner, a former economist at the European Central Bank, said the ECB's intervention had done little to help the crisis of confidence boosting up the share markets.
"This reflects the fundamentals that growth is in a very bad situation on both sides of the Atlantic and this is why the ECB's interventions will not alter anything.
"We can't get much positive momentum out of it, but for the bond markets it was a good sign."
Earlier, Asian  stock shares had lose due to the US downgrade.

Japan's Nikkei and Hong Kong's Hang Seng indexes fall 2.2%, while South Korea's Kospi fell 3.8%.

These added to the significant falls seen last week when trillions of dollars were wiped from the value of global markets, with the Dax losing about 13% of its value, the FTSE 100 falling almost 10% and the Dow ending the week 5.8% lower.

Global stock markets slump on eurozone debt fears

Globally shares have dropped sharply for the second day as fears about the eurozone debt crisis intensified.

New York's Dow Jones index was trading more than 3% down, while Frankfurt's Dax and London's FTSE 100 indexes closed almost 3.5% lower.

European Commission President Jose Manuel Barroso's warning that the sovereign debt crisis is spreading spooked the markets.

On the side, the price of gold hit a new record in history high of $1,677 an ounce.

More weak jobs data from the US also raised concerns about the strength of the economic recovery there.

Banks were hit particularly hard, with Lloyds Banking Group down 9.9% and Royal Bank of Scotland falling 7% in London, Societe Generale losing 6.9% in Paris and Commerzbank dropping 6.8% in Frankfurt.

Miners also suffered, with Vedanta Resources slumping 9.5% and Xstrata and Eurasian Natural Resources falling more than 8% in London.

The oil price also dowm on fears that a weaker global recovery would hit demand. US light crude reduced by more than $4 a barrel, or almost 5%, to $87.63. London Brent fell by almost $5 a barrel to $108.85.