Monday, June 11, 2012

Global stocks fall on Spain bank bailout uncertainty

US stocks fell on Monday as Europe's aid package for Spanish banks did little to alleviate investor concerns about the euro zone's finances and a slowdown in the wider global economy.

The Dow Jones industrial average dropped 142.97 points, or 1.14 percent, to 12,411.23. The Standard & Poor's 500 Index fell 16.73 points, or 1.26 percent, to 1,308.93. The Nasdaq Composite Index lost 48.69 points, or 1.70 percent, to 2,809.73.

European shares ended flat as a sharp relief rally triggered by a euro zone rescue plan for Spain's banks faded, and were braced for a bumpy ride as sellers started to target debt-laden Italy.

The FTSEurofirst 300 index of top European shares closed 0.1 percent higher at 983.06 points, after going as high as 1,001.38 on short-lived enthusiasm about a 100 billion euro agreement to recapitalise Spain's struggling lenders.

In Asia, Nikkei share average rebounded as a euro zone decision to pump up to $125 billion into Spain's struggling banks eased investors' fears about contagion from the country's financial sector.

The Nikkei rose 2 percent to 8,624.90 , recovering from a 2.1 fall on Friday to step clear of its 14-day moving day average at around 8,535.84. The benchmark index was supported by Canon Inc, the most traded stock on the main board, which climbed 3.5 percent. 

The Topix gained 1.7 percent to 730.07 in the thinnest volume for two weeks, with 1.45 billion shares changing hands.