Stocks end week’s big slide
But fears that drove sharp drop not allayed
PARIS – Stock markets in Europe and the U.S. recouped some of their previous day’s hefty losses Friday but investors remained skeptical about whether the world’s leading economies will come up with a coordinated plan to shore up the global economy.
Fears over another recession in Europe and the U.S. contributed to Thursday’s slide, which prompted the finance ministers of the Group of 20 leading developed and developing economies to say they will work together to stabilize markets.
Their pledge to “take all necessary actions to preserve the stability of the banking systems and financial markets” and to make sure banks have the cash they need to pay their day-to-day expenses, helped cushion markets from a repeat of Thursday.
But investors will be looking for more during the weekend meetings of the International Monetary Fund and the World Bank.
“I think many in the markets are no longer reassured by platitudes, we want to see action and not just words – more walking the walk and less talking the talk,” said Louise Cooper, an analyst with BGC Partners. “The G20 communique was more eloquent on the problems facing the world than the solutions to be found.”
In Europe, France’s CAC-40 closed up 1 percent at 2,810.11 while the DAX in Germany rose 0.6 percent to 5,196.56. The FTSE 100 index of leading British shares ended 0.5 percent higher at 5,066.81.
Wall Street pushed higher too – the Dow Jones industrial average was up 0.1 percent at 10,745 while the broader Standard & Poor’s 500 index rose 0.5 percent to 1,134.
Despite the modest gains Friday, the worries are piling up for investors: a U.S. Federal Reserve warning earlier this week that the American economy is in significant difficulty, a raft of downbeat European and Asian economic indicators, and the concern over Greece’s debt.
“The markets are eagerly awaiting a resolution or at the minimum, a more rigid strategy to reduce Greece’s debt liabilities,” said Giles Watts, head of equities at City Index.