Markets start year on upbeat note

World stock markets have started the year on a positive note, gaining ground after shares saw record falls in 2008.

In London, the FTSE 100 index was up by 2.88% at close and in France and Germany the major indexes had risen by 4.09% and 3.39% respectively.

At close on Wall Street, the Dow Jones ended the day 2.94% ahead.

However, analysts said gains might not be sustainable, with many market participants still on holiday and low trading volumes.

'Distant horizons'

"It is customary to greet the New Year with a surge of optimism," said Stephen Lewis, an analyst at Monument Securities.

"Past cares are buried as eyes are raised to more distant horizons."


2008 - MAJOR MARKET FALLS
New York - down 33.84%
London - down 31.3%
Paris - down 42.7%
Frankfurt - down 40.4%
Mumbai - down 51.9%
Singapore - down 49.2%
Sydney - down 41.3%
Hong Kong - down 48.3%
Shanghai - down 65.2%
Tokyo - down 42.1%

The FTSE 100 had suffered its worst year on record in 2008 - a fall of 31.3%.

In Asia, South Korea's main stock index closed up 2.9% at 1,157.40 points. Hong Kong's Hang Seng index rose 4.6% and Indian shares climbed 0.6%.

Markets in Japan and China were closed for a public holiday.

At close in the US, the Nasdaq was also ahead, by 3.50%, and the S&P 500 was up 3.16%.

Record falls

Global markets saw record falls in 2008 as the financial turmoil and economic slowdown ended the stock market boom.

Shanghai was one of the worst-hit major markets, ending the year 65% lower, which was also a record loss.

In New York, the Dow Jones lost almost 34% of its value in 2008, its worst year since 1931.

The year saw the credit crisis push several major economies into recession, with banks particularly badly hit - many requiring government bail-outs.

Whether the stock markets fall further in 2009 is a matter of debate.

Many investment strategists have written off any chance of a major rebound in at least the first six months of the new year, when company earnings could prove especially bleak.