European shares surged today, reaching their highest close in more than a month, as hopes that the worst of a flurry of asset writedowns may be over sparked a sharp rally in recently beaten-down banking shares.
In London, the FTSE 100 gained 151 (2.6%) to close at 5,853 points. In Paris, the CAC shot up 159 points (3%) to 4,866 while in Frankfurt the DAX added 185 points (2.8%) to 6,720. UBS was the biggest gainer among European blue chips, jumping 12%. The Swiss bank unveiled a $19 billion writedown to double its losses on the value of deteriorating assets and asked investors for more cash. Analysts said the worst had been priced in.
In Dublin, the ISEQ climbed most of the day to close 234 points higher (nearly 4%) at 6,411. Banks were all up, with Anglo Irish Bank showing the biggest gains as it closed nearly 5% higher, up 41 cent at €8.91. AIB was up 36 cent at €13.86 and Irish Life & Permanent up 27 cent at €12.65.
US markets were also up this afternoon, as Lehman Brothers investment bank raised $4 billion in fresh capital in an oversubscribed deal. The Nasdaq was up 52 points this afternoon at 2,331 and the Dow Jones was 261 points higher at 12,524.
Earlier in Tokyo, the Nikkei closed 131 points up at 12,656, after losing 295 points in yesterday's trading. Hong Kong's Hang Seng added 288 points to end at 23,138.
