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| Version 3 | Version 4 |
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| Markets rise as Merkel and Sarkozy set to meet | Markets rise as Merkel and Sarkozy set to meet |
| (40 minutes later) | |
| European shares have consolidated gains made on Friday after debt fears in the eurozone and the US caused turmoil on global markets last week. | European shares have consolidated gains made on Friday after debt fears in the eurozone and the US caused turmoil on global markets last week. |
| Frankfurt's Dax index was up 1% while London's FTSE 100 climbed 0.5%. Paris's Cac gave up early gains to trade flat. | Frankfurt's Dax index was up 1% while London's FTSE 100 climbed 0.5%. Paris's Cac gave up early gains to trade flat. |
| Asian markets closed higher on better-than-expected Japanese growth figures. | Asian markets closed higher on better-than-expected Japanese growth figures. |
| Investors are now looking ahead to a meeting between German Chancellor Angela Merkel and French President Nicolas Sarkozy on Tuesday. | Investors are now looking ahead to a meeting between German Chancellor Angela Merkel and French President Nicolas Sarkozy on Tuesday. |
| Markets were buoyed on Friday by US retail sales figures that beat analysts' expectations, and on Monday by data showing the Japanese economy contracted at an annualised rate of 1.3% between April and June, a much smaller amount than had been expected. | Markets were buoyed on Friday by US retail sales figures that beat analysts' expectations, and on Monday by data showing the Japanese economy contracted at an annualised rate of 1.3% between April and June, a much smaller amount than had been expected. |
| The two sets of figures have "allowed for a collective sigh of relief across the global investment community", according to Jane Foley at Rabobank International. | The two sets of figures have "allowed for a collective sigh of relief across the global investment community", according to Jane Foley at Rabobank International. |
| "A calmer tone has settled over the markets after last week's turmoil." | "A calmer tone has settled over the markets after last week's turmoil." |
| As a result, investments perceived as safe during times of economic uncertainty slipped. | As a result, investments perceived as safe during times of economic uncertainty slipped. |
| The Swiss franc fell almost 3% against both the US dollar and the euro, pushed lower by reports that the Swiss National Bank was planning to set a temporary target range for the currency against the euro, following sharp rises in its value in recent weeks. | The Swiss franc fell almost 3% against both the US dollar and the euro, pushed lower by reports that the Swiss National Bank was planning to set a temporary target range for the currency against the euro, following sharp rises in its value in recent weeks. |
| Gold also continued its retreat, falling to $1,739 an ounce from last week's record high of $1,793. | Gold also continued its retreat, falling to $1,739 an ounce from last week's record high of $1,793. |
| Eurozone bonds | Eurozone bonds |
| The French and German leaders will be discussing longer-term solutions to the eurozone debt crisis, which has threatened to engulf Italy and Spain. | The French and German leaders will be discussing longer-term solutions to the eurozone debt crisis, which has threatened to engulf Italy and Spain. |
| Even France, the bloc's second-biggest economy, was drawn into the crisis last week amid rumours, which were denied on all sides, that it could lose its top-ranked credit rating. | Even France, the bloc's second-biggest economy, was drawn into the crisis last week amid rumours, which were denied on all sides, that it could lose its top-ranked credit rating. |
| Figures released on Friday also showed that economic growth in the country came to a standstill between April and June. | Figures released on Friday also showed that economic growth in the country came to a standstill between April and June. |
| The adoption of so-called eurozone bonds as part of closer economic union between the 17 countries that make up the bloc was widely reported as being central to the two leaders' discussions on Tuesday. | The adoption of so-called eurozone bonds as part of closer economic union between the 17 countries that make up the bloc was widely reported as being central to the two leaders' discussions on Tuesday. |
| These bonds would, in effect, be IOUs issued to investors backed by the eurozone as a whole, rather than individual countries. | These bonds would, in effect, be IOUs issued to investors backed by the eurozone as a whole, rather than individual countries. |
| Italian Finance Minister Giulio Tremonti has described the bonds as the "master solution" to the debt crisis. | Italian Finance Minister Giulio Tremonti has described the bonds as the "master solution" to the debt crisis. |
| However, Berlin has strongly denied that the idea will be on the agenda. | However, Berlin has strongly denied that the idea will be on the agenda. |
| "The German government has said on numerous occasions that it does not believe eurobonds make sense and that's why they will not play any role at tomorrow's meeting," said government spokesman Steffen Seibert. | "The German government has said on numerous occasions that it does not believe eurobonds make sense and that's why they will not play any role at tomorrow's meeting," said government spokesman Steffen Seibert. |
| Following this statement, Mr Sarkozy's office confirmed that eurobonds would not be discussed with Mrs Merkel. | |
| German Finance Minister Wolfgang Schaeuble had already ruled out the introduction of eurobonds as long as individual countries conduct their own economic policy. | |
| Tougher austerity | Tougher austerity |
| Policymakers are looking for longer-term solutions to the debt crisis, to help calm nervous investors. | Policymakers are looking for longer-term solutions to the debt crisis, to help calm nervous investors. |
| The European Central Bank's decision last week to begin buying Spanish and Italian government bonds, while welcomed by the markets, is seen as an attempt to address the symptoms of the crisis rather than its causes. | The European Central Bank's decision last week to begin buying Spanish and Italian government bonds, while welcomed by the markets, is seen as an attempt to address the symptoms of the crisis rather than its causes. |
| Italy announced tougher austerity measures designed to reduce its budget deficit on Friday, while Spain has also said it will speed up spending cuts. | Italy announced tougher austerity measures designed to reduce its budget deficit on Friday, while Spain has also said it will speed up spending cuts. |
| After heavy stock market losses during the previous week, European investors regained some composure last week. The Dax index was down less than 4%, the Cac lost 2% while the FTSE gained almost 1.5%. | After heavy stock market losses during the previous week, European investors regained some composure last week. The Dax index was down less than 4%, the Cac lost 2% while the FTSE gained almost 1.5%. |
| The improved performance was largely due to a number of policy announcements in Europe and the US: | The improved performance was largely due to a number of policy announcements in Europe and the US: |
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