World stocks rally

European and Wall Street stocks rallied sharply on Thursday amid great volatility, reassured by an announced meeting between leaders of France and Germany. In London, the FTSE 100 index climbed 3.11 percent to 5,162.83 points, while in Frankfurt the DAX climbed 3.28 percent to 5,797.66 points and in Paris the CAC 40 rose 2.89 percent to 3,089.66 points.Over on Wall Street, in midday trading, the Dow Jones Industrial average was up by 2,20 percent, the S&P 100 climbed 2.51 percent and the Nasdaq rose 2.86 percent. After volatile trading during the day stocks in Europe moved up after French President Nicolas Sarkozy called a eurozone crisis meeting with his German counterpart. Merkel will travel next Tuesday to Paris for the meeting aimed at producing "joint proposals" by September on how to better manage the euro and avoid future instability, Sarkozy's office said.Financial markets have suffered dizzying losses in recent days and weeks amid mounting concern that the eurozone debt crisis and weak US economy could help push the world back into recession.During the day rumours persisted on the stability of French banks amid renewed concern over exposure to troubled Greek debt.Societe Generale aggressively pushed back against talk of its imminent demise, with the French financial regulator warning anyone profiting on "false information" would face penalties. It also emerged European banks were increasingly turning to the European Central Bank overnight lending facility instead of borrowing from one another, suggesting suspicions of poor bank liquidity remain. European interbank lending rates were also on the rise. "Markets will continue this giddying roller-coaster of fear until there is any indication that European policymakers are starting to set the agenda and not reacting to it. Think we have a lot more of this in the coming days and weeks," Michael Hewson, Market Analyst at CMC Markets said. Joshua Raymond, Chief Market Strategist, City Index commented: "Equities traded particularly choppy with traders switching and chopping positions at high frequency throughout the day remaining highly sensitive to any news, data or rumour. Italy promised Thursday to meet many of the demands made by European Central Bank for major economic reforms in return for help in shielding the country from the debt crisis. "We need to have very strong austerity measures in 2012 and 2013," Finance Minister Giulio Tremonti told lawmakers, who had been called back from summer holidays to debate the moves. In early foreign exchange deals, the dollar sank as low as 76.31 yen as investors flocked to the relative safety of the Japanese currency. That was not far from its post-World War II low of 76.25 yen.The dollar later stood at 76.56 yen, down from 76.90 yen in New York on Wednesday. The euro dipped to $1.4149 from $1.4178.Gold prices pulled back to $1,791.18 per ounce, after hitting a fresh record high of $1,814.95 overnight as investors sought the safe-haven precious metal. Asian stock markets mostly fell on Thursday but closed off their early lows as some traders went bargain-hunting despite Wednesday's huge falls in Europe and on Wall Street.