World markets higher as Japanese stocks jump

[March 22, 2011]  BANGKOK (AP) -- Investors embraced stocks and sent world benchmarks higher Tuesday despite escalating violence in Libya and Japan's post-earthquake struggle to get production going again. The Nikkei posted significant gains amid signs that Japan's nuclear crisis is stabilizing.

Oil prices hovered above $102 a barrel as oil exports from OPEC-member Libya remain shut down amid attacks by Western allies on forces loyal to Moammar Gadhafi. The dollar was down against the yen and the euro.

European shares were higher in early trading following a day of gains in Asia. Britain's FTSE 100 rose 0.3 percent to 5,801.63. Germany's DAX was flat at 6,810.07 and France's CAC-40 was 0.2 percent higher at 3,912.59.

Wall Street was headed slightly higher after solid gains the previous day. Dow Jones industrial futures were up 0.2 percent to 11,985 and S&P 500 futures added 0.2 percent to 1,295.

The Nikkei 225 stock average jumped 4.4 percent, or 401.57 points, to 9,608.32, with sentiment buoyed by signs that authorities had stabilized a nuclear power plant after a catastrophic earthquake on March 11 unleashed a tsunami that slammed into the complex, causing major malfunctions and radiation leaks.

Two of Japan's big three auto manufacturers -- Toyota, Honda and Nissan -- posted ample gains amid expectations their operations would slowly ramp up after being halted by the quake. Toyota Motor Corp. rose 4 percent and Honda Motor Corp. was 2.1 percent up. Nissan Motor Co. was down 0.1 percent.

The car makers had suffered steep losses after the quake because northeastern Japan is a major center for auto parts suppliers.

Other companies that comprise Japan's powerhouse export sector also recuperated Tuesday, the first day of trading this week after a public holiday. Consumer electronics companies were sharply up, including Panasonic Corp., by 4.9 percent; and Sony Corp., by 3.2 percent. Elpida Memory Inc., the world's No. 3 maker of computer-memory chips and a leading manufacturer of DRAMs, jumped 6.4 percent.

Companies expected to benefit when Japan's reconstruction effort gets under way also got a boost -- Japanese construction company Kajima Corp. leapt 10.1 percent and Nishimatsu Construction Co. Ltd. soared 17.4 percent.

Benchmarks elsewhere in Asia posted modest gains. Hong Kong's Hang Seng gained 0.8 percent to 22,857.90. South Korea's Kospi rose 0.5 percent to 2,013.66 and Australia's S&P/ASX 200 inched up less than 0.1 percent to 4,643.40.

Shares in mainland China were mixed. The muted performance followed an announcement Friday that the People's Bank of China would raise the bank reserve requirement ratio by half a percentage point on March 25. The hike, the third this year, is intended to cool lending and inflation.

The Shanghai Composite Index rose 0.3 percent to 2,919.14 while the Shenzhen Composite Index lost 0.1 percent to 1,284.84.

In a research note, DBS Bank Ltd. in Singapore said the central bank's action was "a stark reminder that China continues to tighten banks' net liquidity to help arrest price pressures."

In New York on Monday, stocks started the week with big gains on a major telecommunications deal. The Dow Jones industrial average closed above 12,000 for the first time since the nuclear power plant failed.

The Dow 178.01 points, or 1.5 percent, to 12,036.53. The Standard & Poor's 500 index gained 19.18, or 1.5 percent, to 1,298.38. The Nasdaq composite rose 48.42, or 1.8 percent, to 2,692.09.

AT&T Inc. said it would buy rival T-Mobile USA for $39 billion, creating the largest U.S. cell phone company. And Charles Schwab Corp. said it would buy online brokerage services provider OptionsXpress for $1 billion.

The deals raised hopes that more corporate buyouts could be on the way as businesses become more confident in the economic recovery.

Traders shook off concerns about oil prices even as energy experts warned that Libya's oil exports could be off the world market longer than expected while countries including the U.S. enforced a no-fly zone over Libya.

Benchmark crude for April delivery was down 14 cents to $102.19 a barrel in electronic trading on the New York Mercantile Exchange. The April contract, which expires Tuesday, rose $1.26 to settle at $102.33 on Monday.

In currency markets, the euro rose 0.2 percent against the dollar to $1.4237. The dollar was down 0.2 percent to 81.03 yen.

[Associated Press; By PAMELA SAMPSON]

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