Europe and Britain
Encouraged in part by rising U.S. equities, indexes in Germany, France and Britain rebounded from their recent horrific declines. Although economic news was bleak, especially in Germany where the number of unemployed rose over the psychologically important 4 million mark, hopes of a Fed interest rate cut were enough to boost buyers' moral. All three indexes rose by over 200 points or over 6 percent on the week. The possibility of a reshuffle in the DAX later this month added to the volatile undercurrent. With the German national election scheduled for September 22nd, political activity is heating up to distract investors also. In Britain, the June jubilee celebrations made hash out of economic data because of additional holiday closings, especially in manufacturing (many firms closed not only for the two-day holiday but for a full week). The World Cup also contributed to the letdown in economic activity in Britain and throughout Europe.

Asia
Asian equities were not quite as positive as in Europe and America. In fact, the stalwart index - the South Korean Kospi - was one of two indexes that declined on the week and is now down marginally on the year. The Kospi has lost over 7 percent since the beginning of July. In Japan, the economy continues to be driven by exports, especially those to the United States. Therefore, any U.S. economic data that reflects purchases of Japanese goods are scrutinized carefully. For example, the July employment report, released the first week of August, worried exporters because they fear that the soft U.S. labor market may curtail consumer spending, which in turn would hurt exporters' earnings and sales.

Japanese stocks had a volatile week, as the Nikkei 225 hit a six-month low. But the index staged a comeback on Friday, breaking through the psychologically key 10,000 mark in intraday trade for the first time this month.

Last Week's Highlights   •   Global Stock Market Indexes   •   Recap of Global Markets   •   Currencies   •  Indicator Scoreboard

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