European stock markets have rallied as a ban on the short-selling of financial shares tempted investors back into the battered banking sector, however concerns over the health of French banks kept the mood edgy and trading remained volatile.
France, Italy, Spain and Belgium imposed bans to limit volatility and lift the mood amid rumours over the solidity of banks, all of which have been denied.
Wall Street finished strongly up on Thursday in a week of volatile trading. Responding to his critics, President Barack Obama has blamed the market gyrations on forces beyond his control.
“Europe is dealing with all sorts of financial turmoil that is lapping up on our shores,” the US President said. “Japan’s tragic earthquake hurt economies around the globe, including ours, and cut off supply chains that were very important to us. All of this has further challenged our economy as we have seen played out in our stock market, wild swings up and down.”
World shares edged up, and the stocks rally boosted the euro against the dollar and the safe-haven Swiss franc.