U.S. STOCK MARKETS
The Standard & Poor's 500-stock index posted its biggest daily gain of the year, an exclamation mark on stocks' best June in more than a decade, as investors cheered European leaders' progress on the region's debt problems.
A safe box is seen at the safe room of the Zuercher Kantonalbank (ZKB) at the Bahnhofstrasse in Zurich in this file photo. Investors trying to protect their wealth from global More.
The index jumped 33.12 points, or 2.5%, to 1362.16, the biggest one-day percentage increase since December. Industrials and technology shares paced gains as all 10 of the benchmark's sectors rose.
Nevertheless, stocks remained firmly lower for the second quarter, which ended Friday, due to a plunge in May. The Dow Jones Industrial Average jumped 277.83 points, or 2.2%, to 12880.09. The Nasdaq Composite rose 85.56 points, or 3%, to 2935.05.
European leaders at a two-day summit in Brussels said they would speed plans to create a single supervisor for the euro zone's banks. They agreed that the euro zone's bailout funds should be able to directly boost the capital of struggling banks, without adding to government debt. Investors had taken a skeptical view ahead of the event, leading stocks to decline early this week.
The gains capped the first down quarter in three for U.S. stocks. The Dow Jones Industrial Average fell 2.5% this quarter, while the S&P 500 retreated 3.3%.
Friday brought mixed readings on the U.S. economy. The Institute for Supply Management-Chicago's business barometer, a survey of Chicago-area purchasing managers, unexpectedly ticked up to 52.9 from 52.7. But the University of Michigan's June consumer-sentiment gauge fell more than expected.
Meanwhile, consumer spending was unchanged in May, failing to increase for the first time in six months, even as income ticked up 0.2%. The data matched economists' expectations.
The core price index for personal-consumption expenditures, which excludes volatile food and energy prices, edged up less than expected in May.
In the corporate arena, Constellation Brands surged 24%, the biggest climb in the S&P 500, after agreeing to buy out the rest of a joint venture that imports and markets Grupo Modelo beer brands such as Corona Extra, the best-selling imported beer in the U.S.
All 30 Dow components traded higher. Research In Motion plunged 19% the day after the BlackBerry maker announced its first quarterly operating loss in more than seven years.
Nike slumped 9.4% after the athletic-apparel maker reported worse-than-expected quarterly results Thursday and warned of slower growth in China. ServiceNow, a provider of cloud computing services for businesses, jumped 37% after its initial public offering on the New York Stock Exchange priced higher than expected.
EUROPEAN STOCK MARKETS , BONDS
European stocks staged their biggest one-day rally of 2012 and Spanish bond yields dropped sharply Friday, after European leaders unexpectedly agreed on a range of measures to combat the euro zone's debt and banking crisis.
The pan-European Stoxx 600 index jumped 2.7% to 251.17, rallying the most since last autumn. For the week, the index closed up 1.9%, while it lost 4.6% on the quarter.
Banks and oil firms led the charge north, with French oil group Total SA adding 4.3% and Italian bank UniCredit SpA up 14.3%.
EU leaders at a two-day summit in Brussels defied market skepticism by agreeing to allow Europe's rescue funds to directly recapitalize the banking sector once a single financial supervisor for the euro zone is in place.
The move will allow Spain's government to avoid taking the cost of its requested bank bailout onto its own books. They also agreed on a widely anticipated EUR120 billion spending package for the euro zone.
The leaders further indicated that the rescue funds can be used to buy government debt, aiming to bring down borrowing costs in Spain and Italy.
Bank stocks rallied, with the Spanish and Italian banking sector rising sharply. In Spain, BBVA SA surged 9%, Bankinter SA jumped 7.3%, while Banco Santander SA added 6.9%.
The IBEX 35 index rallied 5.7% to 7,102.20, putting in its best daily performance since May 2010. The index closed 3.3% higher for the week, but came out of the quarter with an 11.3% loss.
Among Italian stocks, Banca Popolare dell'Emilia Romagna Scarl jumped 10.5%, helping lift the FTSE MIB index 6.6% to 14,274.37. On the week, the index jumped 4.5%. Elsewhere, oil firms were on the rise as oil prices jumped above $81 a barrel. In the U.K., BP PLC gained 2.3% and BG Group PLC rose 3.1%.
The FTSE 100 index closed 1.4% higher at 5,571.15 and rose 1% on the week, although it was down 3.4% on the quarter. In France, the CAC 40 index gained 4.8% to 3,196.65, buoyed by Societe Generale SA, which soared 10%, and BNP Paribas SA, up 9.7%.
Germany's DAX 30 index advanced 4.3% to 6,416.28, with Deutsche Bank AG rising 5.9%. Car maker BMW AG added 5.1% after UBS lifted the stock to buy from neutral. Daimler AG also tracked higher, up 4.5%. Among other notable gainers, beer company Anheuser-Busch InBev NV added 3.9% after it confirmed it will buy the remaining stake in Grupo Modelo that it doesn't already own in a deal valued at $20.1 billion.
ASIA-PACIFIC STOCK MARKETS
Asian markets ended a tumultuous second quarter with a rare spot of cheer, as stocks surged Friday on news that euro-zone leaders agreed to measures aimed at stabilizing volatile markets.
The move caught markets off guard in Asia, and quickly pushed them into positive territory, rebounding from earlier losses.
The Japanese market, which had been weighed down by a stronger yen and poor industrial production data earlier in the session, recovered on the European news to end 1.5% higher at 9006.78.
A fall in the consumer price index also helped sentiment in Japan, as it increased hopes that the Bank of Japan might expand its asset purchasing program when it next meets in the middle of July.
Among major stock movers, Sony Corp. rose 2.4% and Toyota Motor Corp. gained 2.6% in Tokyo, reversing losses earlier in the day.
In Hong Kong, China Coal Energy Co. jumped 4.1%, Sino Land Co. rose 3% and gaming firm Sands China Ltd. jumped 5.6%. Energy stocks rallied as front-month Nymex crude-oil futures spiked.
Inpex Corp. gained 2.4% in Tokyo and PetroChina Co. rose 2.4% in Hong Kong and 0.8% in Shanghai. Gold miners were bolstered by a rise in August Comex futures, while base metal stocks also rose on a bounce in copper and other metals.
Shares of Zijin Mining Group Co. rose 2.8% and Jiangxi Copper Co. added 2.2% in Hong Kong; in Shanghai, they rose 1.3% and 2.6%, respectively. Gains for mainland Chinese stocks were relatively subdued after data from the National Bureau of Statistics showed profits for major companies dropped 5.3% in May from the year-earlier month.
Base metals closed sharply higher on the London Metal Exchange Friday, rallying alongside broad financial markets as a euro-zone agreement to aid struggling banks eased fears about the region's debt crisis.
At its peak, flagship three-month copper was up 4.1% on the day at $7,691 a metric ton, its highest price since May 29. The red metal closed at $7,684/ton.
Lead saw the largest gains at the close, up 4.7% at $1,860/ton. Despite Friday's strong performance, base metal prices still ended the quarter significantly lower than where they started.
Copper shed 9% in value in the second quarter, while aluminum fell 10% in the period. Crude-oil futures shot up more than 9% Friday, buoyed by strong results at a European Union summit and renewed anxiety on Iran.
Nymex crude-oil futures settled at $84.96 a barrel, a rise of a $7.27, or about 9.4%, the biggest one-day oil rise in percentage terms since March 2009 and one of the biggest single-day increases since Nymex crude oil began trading in 1983.
Investors overlooked a negative consumer-sentiment survey to send futures higher, as oil outperformed other leading commodities. Silver futures rose 5.1%, while gold retook the $1,600 level, as investors cheered surprise signs of progress in Europe's battle to contain its bank crisis.
Gold for August delivery, the most actively traded contract, settled up $53.80, or 3.5%, at $1,604.20 a troy ounce on the Comex division of the New York Mercantile Exchange. Silver, which had traded at a 19-month low a day earlier, increased 5.1%, or $1.333, to settle at $27.580 a troy ounce.
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