Euro zone finance ministers on Sunday agreed to lend Spain up to 100 billion euro to help its battered banks. Meanwhile Spanish prime minister said that this bailout package is simply a line of credit, which means that it can avoid a full rescue.
The US markets ended higher in thin trading on optimism that
the euro zone leaders are moving closer to tackling the crisis. The S&P 500 posted its best weekly gain since December, amid speculation that European and American central banks will join China in trying to spur economic growth.
For the week, the Dow advanced 3.6%, the S&P 500 rose 3.7% and the Nasdaqjumped about 4%, posting their best weekly percentage gains since December.
The US futures gained over a percent after euro zone finance ministers agreed to a bailout package for Spain.
Meanwhile, the European markets retreated from one-week highs and closed lower on Friday.
Most Asian markets are trading higher today after euro zone finance ministers agreed on loans worth 100 billion euro for Spain easing fears that financial crisis will escalate. Nikkei managed to snap its nine week losing streak last week with minor gains.
It was a mixed bag in terms of the economic data released in China over the weekend. The industrial production was lower than expectations while the inflation tick cooled down.
Back home, it was the best weekly performance in 2012 for our own markets with theNifty gaining nearly 5% last week.
Data to watch
This is data heavy week for Indian markets with the industrial production (IIP) numbers to be announced tomorrow and inflation data on Thursday.
Currency Corner
The euro has strengthened to a two week high; it is trading over 1.26 against the dollar. However, the dollar index has slipped below the 82 mark.
The rupee will be in focus today as the Reserve Bank of India will infuse Rs 12,000 crores into the market tomorrow to ease liquidity by buying government securities.
Commodities
Crude prices witnessed over 2% gains following news of recapitalisation plan for Spanish banks. Brent crude is now trading above USD 101 per barrel.
Gold prices have rebounded to USD 1600 per ounce after hitting a session low of USD 1561 per ounce on Friday. (curtsey : money control)
Rupesh Yatesh Dalal
Head Research Department
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