Stocks rebound from Monday fall

Shares in Europe have rebounded from Monday's heavy losses, following a largely positive session in Asia. In London the FTSE 100 index was up 1.8 percent, in Frankfurt the Dax added 1.7 percent and in Paris the Cac 40 gained 1.4 percent. Stocks rebound from Monday fall Asian markets were largely higher, Tokyo's Nikkei average closed up 1.5 percent, Hong Kong's Hang Seng added 1.3 percent and Mumbai's Sensex was up 1.4 percent. Investors are expecting the U.S. Federal Reserve to slash interest rates later on Tuesday to boost the U.S. economy. Some think it might cut its benchmark Fed funds rate by one percentage point. The rebound recovers some, but not all, of the losses on Monday. Investor fears Shares on Wall Street had a volatile session on Monday. The Dow Jones industrials average ended 0.18 percent higher, after tumbling in early trading. European shares had fared worse. The UK's FTSE 100 index, France's CAC 40 and Germany's Dax slumped by more than 3 percent. Investors fear that the collapse of Bear Stearns, one of Wall Street's biggest names, means that the credit crunch is escalating, hastening the onset of a worldwide recession. They are now awaiting results from some of the other key U.S. investment banks, with both Goldman Sachs and Lehman Brothers reporting their latest results. central bank action On Monday central banks in both the UK and U.S. moved to ease the crisis. The Bank of England injected GBP 5bn to boost lending among banks, while the Fed cut its discount rate - the interest rate at which it lends to commercial banks - from 3.5 percent to 3.25 percent. And U.S. President George Bush attempted to reassure investors, accepting that the American economy faced "challenging times" but insisting that the Fed was "on top of the situation". "When need be, we will act decisively, in a way that continues to bring order to the financial markets," he said. "In the long run, our economy is going to be fine."

Stocks rebound from Monday fall

Asian markets were largely higher, Tokyo's Nikkei average closed up 1.5 percent, Hong Kong's Hang Seng added 1.3 percent and Mumbai's Sensex was up 1.4 percent.

Investors are expecting the U.S. Federal Reserve to slash interest rates later on Tuesday to boost the U.S. economy.

Some think it might cut its benchmark Fed funds rate by one percentage point.

The rebound recovers some, but not all, of the losses on Monday.

Investor fears

Shares on Wall Street had a volatile session on Monday.

The Dow Jones industrials average ended 0.18 percent higher, after tumbling in early trading.

European shares had fared worse.

The UK's FTSE 100 index, France's CAC 40 and Germany's Dax slumped by more than 3 percent.

Investors fear that the collapse of Bear Stearns, one of Wall Street's biggest names, means that the credit crunch is escalating, hastening the onset of a worldwide recession.

They are now awaiting results from some of the other key U.S. investment banks, with both Goldman Sachs and Lehman Brothers reporting their latest results.

central bank action

On Monday central banks in both the UK and U.S. moved to ease the crisis.

The Bank of England injected GBP 5bn to boost lending among banks, while the Fed cut its discount rate - the interest rate at which it lends to commercial banks - from 3.5 percent to 3.25 percent.

And U.S. President George Bush attempted to reassure investors, accepting that the American economy faced "challenging times" but insisting that the Fed was "on top of the situation".

"When need be, we will act decisively, in a way that continues to bring order to the financial markets," he said. "In the long run, our economy is going to be fine."