The Standard Poor’s 500-stock index was up 0.1 percent in early trading, while the Dow Jones industrial average was flat. The Nasdaq composite index was 0.4 percent higher.
The action was mostly in Europe. French lenders posted solid gains, leading European indexes upward, after the financial daily Le Figaro reported that the French government was prepared to act to help “two or three banks.” The Figaro report did not identify the source of its information, and news agencies cited French officials as denying that such a plan was in the cards.
BNP Paribas rose 5 percent, Société Générale rose 2.9 percent and Crédit Agricole gained 2.1 percent. Dexia, the failing bank that the French and Belgian governments this week said they would guarantee, began the day higher but by afternoon was 14.2 percent lower.
Investors were also reacting to the results of a European Central Bank policy meeting, the last to be headed by the bank’s president, Jean-Claude Trichet, before he is replaced by Mario Draghi.
The central bank moved to help European banks that are having trouble raising short-term cash, while the Bank of England decided to resume its bond purchases to help support a slowing British economy. Both central banks left their key benchmark rates unchanged, at 1.5 percent for the euro area covered by the European Central Bank, and 0.5 percent for Britain.
In afternoon trading, the Euro Stoxx 50 index, a barometer of euro zone blue chips, rose 1.2 percent, while the FTSE 100 index in London rose 1.9 percent.
Investors were also encouraged by a report by the Institute for Supply Management on Wednesday that showed that non-manufacturing businesses continued to grow in September.
Longer term, however, the picture remains as murky as ever, and financial markets continue to face what strategists at HSBC, in their latest quarterly assessment, called “an unbearable degree of uncertainty.”
“After falling 22 percent from their April highs, global equities are likely to remain tricky,” Garry Evans, head of global equity strategy at HSBC in Hong Kong, wrote. “There are few signs of a bold solution to Europe’s sovereign debt issues, and the 23 November deadline for U.S. debt negotiations looms.”
Moreover, he added, economic growth prospects have not bottomed. Although the jury is still out on whether the world will actually tip into another recession, markets will continue to fret that it might, he said.
Asian shares rallied. The Tokyo benchmark Nikkei 225 stock average rose 1.7 percent. The Sydney market index S.P./ASX 200 rose 3.7 percent. In Hong Kong, the Hang Seng index rose 5.7 percent.
Global markets have been gyrating for months now, and with no sign that the European debt issues will be resolved any time soon, they are expected to remain volatile for the foreseeable future. The feeble state of the American economy and moderating expansion in growth engines like China and India also have compounded the global nervousness.
Crude oil futures for November delivery fell 0.2 percent to $79.51 a barrel. Comex gold futures slipped 0.1 percent to $1,638.50 an ounce.
The dollar was mixed against other major currencies. The euro rose to $1.3384 from $1.3348 late Wednesday in New York, while the British pound rose to $1.5481 from $1.5460. The dollar fell to 76.67 yen from 76.79 yen, but rose to 0.9239 Swiss francs from 0.9232 francs.
Yields on the government bonds that investors see as the safest assets rose, as money flowed into stocks. The yield on the 10-year United States Treasury rose 5 basis points to 1.93 percent, while the yield on the comparable German security rose 5 basis points to 1.88 percent.
David Jolly reported from Paris and Bettina Wassener from Hong Kong.
Article source: http://feeds.nytimes.com/click.phdo?i=bbd96b40082915b40303c82b7ffacf2b
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