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US stocks open higher on news of EU pact

Reported by AAP
Saturday, December 10, 2011
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Financials
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US stocks have opened higher after Europe's leaders, except Britain, reached a tentative deal on implementing tougher fiscal discipline throughout the European Union.

After the first half hour of trade on Friday, the Dow Jones Industrial Average was up 113.30 points (0.94 per cent) at 12,111.00.

The broader S&P 500 rose 11.87 (0.96 per cent) to 1,246.22, while the Nasdaq Composite gained 18.77 (0.72 per cent) to 2,615.15.

A few hours earlier EU leaders meeting in Brussels on the eurozone crisis signalled their willingness to join a "new fiscal compact" to resolve the two-year crisis threatening to crack apart the monetary union.

The deal remained tentative: all 17 eurozone countries signed on, while nine other EU nations not using the euro "indicated the possibility to take part", EU leaders said in a statement.

Britain stood out as refusing to join the deal that would impose region-wide standards on fiscal management.

European markets jumped higher in reaction and US stocks followed suit, led by financials.

"Initial strength came amid reports of progress at the latest eurozone summit. A consensus on every agenda item has reportedly eluded members, but that's not so surprising given the dissension displayed by so many eurozone officials during efforts of the past few months," said Briefing.com.

Morgan Stanley picked up 5.4 per cent, Citigroup 3.9 per cent, and Goldman Sachs 2.6 per cent.

Dupont stood out as a big loser among the Dow blue chips, losing 6.7 per cent after dimming its outlook for earnings this year, citing slower growth than expected.

Bond prices fell slightly. The yield on the 10-year Treasury rose to 1.98 per cent from 1.97 per cent late Thursday, while the 30-year edged up to 3.01 per cent from 3.00 per cent.

Bond prices and yields move in opposite directions.

24/09/2014 12:23Sydney, Australia. 24 September,2014
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