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World stocks up again as banks remain in demand

 A man walks in front of an electronic stock board of a securities firm in Tokyo, Japan, Wednesday, March 11, 2009. The benchmark Nikkei 225 stock ave...
 A woman walks in front of an electronic stock board of a securities firm in Tokyo, Japan, Wednesday, March 11, 2009. The benchmark Nikkei 225 stock a...
 A man walks in front of an electronic stock board of a securities firm in Tokyo, Japan, Wednesday, March 11, 2009. The benchmark Nikkei 225 stock ave...

Japan Markets

A man walks in front of an electronic stock board of a securities firm in Tokyo, Japan, Wednesday, March 11, 2009. The benchmark Nikkei 225 stock ave...

Japan Markets

A woman walks in front of an electronic stock board of a securities firm in Tokyo, Japan, Wednesday, March 11, 2009. The benchmark Nikkei 225 stock a...

Japan Markets

A man walks in front of an electronic stock board of a securities firm in Tokyo, Japan, Wednesday, March 11, 2009. The benchmark Nikkei 225 stock ave...

World markets were mostly higher Wednesday as financial stocks remained in demand after upbeat comments from Citigroup's chief executive fueled hopes that the worst of the banking crisis may be over.
However, ongoing concerns about the world economy _ illustrated by a sharp fall in Chinese exports in February _ and doubts about the sustainability of the stock market rally capped the buying.
"We are maybe seeing some skepticism that this rally will peter out as so many have in the past," said Keith Bowman, an equities strategist at stockbrokers Hargreaves Lansdown in London.
The FTSE 100 index of leading British shares, which jumped nearly 5 percent Tuesday, was up another 18.48 points, or 0.5 percent, at 3,733.71, while Germany's DAX, which did even better in the previous session, rose a further 76.45 points, or 2 percent, to 3,963.43. The CAC-40 in France was up 70.15 points, or 2.6 percent, at 2,733.83.
And the U.S. opened higher following Tuesday's hefty gains. The Dow Jones industrial average, which surged by nearly 6 percent in the previous session, was up another 69.62 points, or 1 percent, at 6,996.11. The broader Standard & Poor's 500 index rose 10.36 points, or 1.4 percent, to 729.96.
Earlier in Asia, Japan's Nikkei index joined in the rally, having fallen to a 26-year low in the previous trading session. It closed 321.14 points, or 4.6 percent, higher at 7,376.12 on Wednesday. Meanwhile Hong Kong's Hang Seng index rallied further, up another 236.61 points, or 2 percent, to 11,930.66.
The catalyst for the latest rally was a letter earlier this week from Citigroup Chief Executive Vikram Pandit to employees saying the bank posted its best operating profit in the first two months of the year since the third quarter of 2007, when it last booked a quarterly profit.
Investors, desperate for any positive signs about the ailing financial system, latched onto the positive news, especially as Citigroup has lost so much money the U.S. government has been forced to extend billions in aid and take a 36 percent stake in the banking giant.
Financial stocks around the world continued to be the main beneficiaries from Citigroup's news. Barclays PLC was up another 8 percent, while Deutsche Bank AG rose a further 7 percent.
In Asia, leading Japanese bank Mitsubishi UFJ Financial Group Inc. gained 4.1 percent, while HSBC in Hong Kong advanced a further 2 percent, continuing its recovery form Monday's 24 percent plunge.
Analysts were encouraged that some stability appeared to return to the banking sector, which is absolutely crucial for the economic recovery _ a point stressed Tuesday by U.S. Federal Reserve chairman Ben Bernanke.
However, they said it is way too early to say the current upbeat mood will last and that the room for disappointment remained large particularly as the Obama administration has still to flesh out the details of its bank rescue plan.
"There is plenty of scope for further disappointments," said Geoffrey Yu, an analyst at UBS.
The relief at Citigroup's performance was tempered somewhat by the news that China saw exports slump in the year to February as a result of waning global demand. Mainland China's main market in Shanghai ended 0.9 percent lower at 2,139.03.
Elsewhere in Asia, South Korea's Kospi rose 35.31, or 3.2 percent, to 1,127.51. Benchmarks in Australia and Taiwan were up 1.9 percent; Singapore's gained 1.3 percent.
Oil prices were lower, with light, sweet crude for April delivery down 45 cents at $45.26 a barrel on the New York Mercantile Exchange. The contract fell $1.36 to settle at $45.71 a barrel overnight.
The dollar weakened 0.6percent to 97.98 yen while the euro rose 0.9 percent to $1.2785.
____
AP Business Writer Jeremiah Marquez in Hong Kong contributed to this report.


Updated : 2021-05-07 16:06 GMT+08:00