Battered stock markets get breathing room, but fear contagion

0 Comments | AFP, August, 2007

NEW YORK (AFP) — Global investors will be watching nervously for signs of contagion from the US housing meltdown and a credit squeeze in coming days, even after a broad stock markets rebound over the past week from recent turbulence.

Major markets posted healthy gains over the past week after central banks stepped up their actions to keep credit flowing amid fears of a widening crisis involving subprime or "junk" US mortgage loans.

Wall Street's blue-chip Dow Jones Industrial Average rallied 2.29 percent in the week to Friday while the broad-market Standard & Poor's 500 advanced 2.31 percent and tech-led Nasdaq composite added 2.86 percent, recouping a portion of the hefty losses earlier this month.

London's FTSE rallied 2.57 percent, while Frankfurt's DAX...