Stocks in Europe, Asia Finish Stronger; U.S. Markets Closed

Major stock markets around the world posted gains Thursday, taking heart from Wall Street’s rebound late Wednesday.

U.S. markets were closed for the Fourth of July holiday and will be open for a half-day session today.

In Asia, stocks gained in South Korea, Hong Kong and Taiwan, helped by U.S. markets’ turnaround Wednesday. The Dow Jones industrials rose 47.22 points, or 0.5%, to 9,054.97 and the Nasdaq composite added 22.35 points, or 1.7%, to 1,380.17, after two days of heavy selling tied to corporate accounting scandals and fear of terrorist attacks.

In South Korea, the composite index rose 2% to 768.74, the fifth consecutive gain. The index is up 10.8% this year, a strong performance given heavy losses in most other markets.

In Hong Kong, the Hang Seng index rose 1.8% to 10,765.58, while Taiwan’s weighted index jumped 1.6% to 5,130.80.

Many investors are betting that Asian companies will benefit early from the global economy’s recovery.

But in Tokyo, shares fell as Japanese investors cashed in gains from the previous session. The benchmark 225-issue Nikkei index slid 179.49 points, or 1.7%, to finish at 10,632.81. It is up 0.9% this year, compared with the U.S. Standard & Poor’s 500 index’s 17% decline.

In Europe, most markets closed higher as the European Central Bank met and voted to leave short-term interest rates unchanged, citing fears that Europe’s economic recovery is lacking vitality.

Also, a surge in shares of France Telecom helped drive the French market. France Telecom rocketed 16% amid increasing confidence that the French government, the company’s major shareholder, will step in to prevent a liquidity crisis.

Shares of Vivendi Universal also rebounded after diving early in the week on fears the company faces a cash crisis.

France’s CAC-40 stock index rose 2% on Thursday, but it’s still down 20.1% year to date.

Gains in battered telecom shares also helped other markets.

In Germany, the DAX index rallied 2.9% on Thursday. Britain’s FTSE-100 index rose 1.8%, while the Swiss market index was up 2.4%.

Canadian stocks were flat, with the S&P;/TSX index edging up less than 0.1% to 7,029.78. In Mexico City the IPC index added 0.4% to 6,352.89.

In currency trading, the dollar continued to take back some ground against the euro, as traders reassessed the chances the European currency might continue its recent rally.

The euro was trading at 97.9 cents in Europe, down from 98 cents at the New York close on Wednesday. The euro peaked at 99.2 cents on Monday, briefly toying with the $1 level.

The euro has gained as some global investors have soured on dollar-denominated assets in the wake of U.S. accounting scandals.