Wall Street stalls worldwide sharemarket slump

Wall Street stemmed a worldwide sharemarket rout by closing the week in positive territory after a better-than-expected US jobs report.

Earlier, markets in Europe and Asia continued to plummet on fears of a deepening euro-zone debt crisis and signs of recession in the US economy.

The Dow Jones Industrial Average finished up 60.93 points, or 0.5%, at 11,444.61. In a rollercoaster session, the index gained as much as 172 points in early trading after the jobs report but soon dropped 245 points at its morning low.

It then rebounded to add more than 300 points on news that Italy would speed up its fiscal consolidation timetable. The Dow finished the week down 698.63 points, or 5.8%, its biggest weekly point drop since October 2008. It has dropped 9.8% over the past two weeks and is down 1.2% for the year.

Even so, stocks in the broader US market declined. The S&P 500 index edged down 0.1% to 1199.38. For the week, it finished down 7.2%, its biggest percentage drop since November 2008. The index is down 11% throughout the last two weeks.

The technology-oriented Nasdaq Composite Index tumbled 1.0% to 2532.41, slumping 8.1% for the week. It is down 11% over the past two weeks. 

The week will be remembered for the Dow plummeting 513 points on Thursday, its biggest point drop since December 1, 2008, and signalling the market is technically in correction as it has fallen more than 10% below the 2011 closing high in April,

Figures showed 117,000 jobs were added last month and the unemployment rate slid to 9.1%. But this wasn't enough to convince investors that the troubles affecting the US economy are over.

Recent reports have shown a drop in consumer spending, a slowing manufacturing sector and sluggish economic growth.

World markets: Europe, Asia fall
European stock markets ended sharply lower as a global selloff continued, though stronger-than-expected US jobs data helped shares trade above their session lows.

Italian Prime Minister Silvio Berlusconi, in a hastily called news conference after the markets closed, pledged to loosen up the country's labour market and take other moves to stimulate the economy.
He also said Italy would balance its country's budget by 2013, a year earlier than planned, is a bid to counter mounting fears Italy would be the next EU member to need a debt bailout.

The Stoxx Europe 600 index dropped for the sixth straight session and ended down 1.8% at 238.88, its lowest close since July 2010. The index dropped 10% for the week.

UK banks were among the worst performers as London's FTSE 100 index dropped 2.7% to 5246.99.

In Frankfurt, the German DAX 30 index slid 2.8% to 6236.16 while the French CAC 40 fell 1.3% to 3278.56, including a 3% drop for Total as crude-oil prices dropped.

Asian stock markets were pounded as escalating fears over the global economic outlook and Thursday's rout on Wall Street pushed investors into safer assets.

Taiwan's Taiex plunged 5.6% to 7853.13 to lead major indexes lower. Hong Kong's Hang Seng Index dove 4.3% to 20946.14, an 11-month low, and Australia's S&P/ASX 200 index skidded 4% to 4105.40, its lowest close in just over two years.

Japan's Nikkei Stock Average dropped 3.7% to 9299.88, Korea's Kospi declined 3.7% to 1943.75 and India's Sensex fell 2.2% to 17,305.87.
China's Shanghai Composite was the best performer among the region's major markets, losing 2.1% to 2626.42.

India’s Sensex fell 387.31 points, or 2.2%, to close at 17,305.87 – its lowest finish since June 11, 2010.

Commodities: Oil up, gold down
Oil futures finished slightly higher, after signs of progress in Europe's debt crisis. It capped a day of volatile trading with prices spending much of the day lower.

Light, sweet crude for September delivery rose 25USc, or 0.3%, to settle at $US86.88 a barrel in New York. The contract sank to an intraday low of $US82.87 a barrel, its lowest since November 26, before ending the day higher.

Brent crude on the ICE futures exchange was up $US2.12, or 2%, to $US109.37 a barrel.

Gold futures retreated further from their recent record highs. The contract for August delivery fell $US7.40, or 0.5%, to settle at $US1648.80 an ounce in New York.

Gold gained 1.3% for the week, thanks to the rally on Tuesday and Wednesday.

Currencies: ECB buying hope boosts euro
The euro rose on hopes the European Central Bank will buy bonds in larger euro-zone nations Italy and Spain to reduce contagion risks.

But caution still loomed after the US jobs report failed to ease concerns about a possible U.S. double-dip recession and global economic slowdown.

The euro was at $US1.4293 from $US1.4093 late on Thursday. The US dollar traded at ¥78.44 from ¥78.87, while the euro was at ¥112.11 from ¥111.15.

The UK pound fetched $US1.6393 from $US1.6261, while the dollar bought 0.7659 franc from 0.7635 franc.