Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Strong Dollar Pushes European Markets Up

LONDON -- Europe's main exchanges notched up modest gains Monday, boosted by a stronger dollar, but the recovery was seen as shaky with Wall Street shut for the Labor Day holiday.

In London, the blue-chip FTSE 100 index reversed initial declines to close 1.09 percent higher at 4870.2 after weak economic data persuaded the market that further interest rate rises were not imminent.

Germany's DAX index gained a robust 2.15 percent to close at 3989.96, then edged further up to 4001.81 in post-exchange electronic trade.

Dealers in both centers warned the momentum was unlikely to last into Tuesday, with further falls in Wall Street likely and turbulence in Asia set to continue.

"The fact that the U.S. is closed seems to be keeping the sellers out of this market," a German dealer said. "The dollar is really holding us up."

The dollar closed firmer in Europe, underpinned by the general weakness of the yen amid persistent concern about the health of the Japanese economy.

Profit-taking pushed the U.S. currency back below its peak at around 121 yen but dealers said that in the absence of strongly worded remarks about yen weakness from Japanese authorities, negative sentiment would remain.

With U.S. markets shut, European exchanges were able to shake off serious fallout from Asia, although a 5 percent fall in Hong Kong's Hang Seng index hit some British bank shares early in the morning.

"We can't ignore the Asian situation but we are getting to a level where people should be looking to put some money into the market," a British dealer said.

Asian markets fell across the board Monday, led by the Hang Seng, the Hong Kong market's key indicator of blue chips, which sank for the second straight session.

The Hang Seng fell 709.60 points, or 5 percent, to close at 13,425.65, its lowest level in 17 weeks and the first time it closed below 14,000 since June 12. On Friday, the index had slumped 740.85 points.

Howard Gorges of South China Securities Co. said there was panic selling in the last 20 minutes of trading.

He told Radio Hong Kong that for some reason, overseas sellers decided that they simply "had to get out of Hong Kong stocks."

"Whether this is related to the problem around the region, where in some cases, funds hadn't been able to sell shares very easily, or whether it is a reappraisal of the whole region and deciding that exposure in Hong Kong is too high, nobody seems to know," he said.

Share prices also tumbled in Tokyo as investors worried about how Southeast Asia's currency crisis and falling stocks would affect Japan's economy.

The Nikkei Stock Average lost 255.12 points, or 1.40 percent, closing at 17,974.30, its first close below 18,000 points in 4 1/2 months. On Friday, the average had sunk 222.03 points, or 1.20 percent. ()