Global stocks bounce back

Hong Kong shares surge 14% in another volatile session; Japan's benchmark Nikkei index climbs 6%.

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By staff

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LONDON ( -- Global stock indexes rebounded from several days of steep losses Tuesday, with Hong Kong leading the advance.

U.S. stocks were sharply higher, with the Dow Jones industrial average gaining more than 200 points in early trading.

European shares traded in positive territory, with Britain's FTSE 100 index up 3.1%. The CAC-40 in Paris was up about 2.5% and Germany's DAX was 6.2% higher.

In Asia, Japan's Nikkei finished the day 6.4% higher as investors rushed to scoop up shares after the benchmark index sank to its lowest level in 26 years.

The biggest gains were in Hong Kong, where the Hang Seng surged 14.4% - recovering all of the losses it suffered a day earlier.

Elsewhere in Asia, the Taiwan Weighted lost less than 1%, while Singapore's Straits Times was up about 1%.

Widespread fears

Fears of a deep global recession have routed markets worldwide. But upbeat earnings from BP and a drop in the yen on Tuesday helped bolster sentiment.

Oil giant BP posted an 83% surge in third-quarter net income, boosted by high oil prices during the period.

Wall Street joined the rally Tuesday as the Federal Reserve kicked off its two-day meeting on interest rates. The central bank is widely expected to cut rates to at least 1%.

Investors brushed off a Conference Board report on consumer sentiment, in which the New York-based business research group said that its Consumer Confidence Index plummeted to an all-time low.

In currency trading, the dollar surged against the yen. A strengthening yen has raised concerns about a severe global economic slowdown.

Five-year lows

On Monday, major U.S. indexes closed at fresh five-year lows. The Dow lost 2.4%. The S&P 500 index fell 3.2% and the Nasdaq shed 3%.

With just one week left in October, the Dow Jones industrial average is down 22.9%, the Standard & Poor's 500 index is down 27.2% and the Nasdaq composite is down 27.7%.

Even with Tuesday's rise, the Dow is currently on track to post its worst month ever on a point basis and fifth worst ever on a percentage basis, according to Stock Trader's Almanac info going back to 1901.

CNN Wires contributed to this report. To top of page

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