World Stocks Up After Robust US Holiday Shopping

World stocks were boosted Monday by a robust start to the U.S. holiday shopping season and reports that European leaders are considering legal means to force debt-ridden euro countries into fiscal discipline.

Benchmark oil rose above $99 per barrel and the dollar fell against the euro and the yen.

European stock markets rose in early trading. Britain's FTSE 100 added 1.4 percent to 5,235.40. Germany's DAX gained 2 percent to 5,601.80 and France's CAC-40 jumped 2.1 percent to 2,917.54.

Wall Street also appeared headed for a higher opening, with Dow Jones industrial futures rising 1.6 percent to 11,370 and S&P 500 futures jumping 2 percent at 1,176.70.

The gains in Europe tracked those in Asia earlier in the day. Japan's Nikkei 225 index jumped 1.6 percent to close at 8,287.49. South Korea's Kospi gained 2.2 percent to 1,815.28 and Hong Kong's Hang Seng rose 2 percent to 18,037.81. Australia's S&P/ASX 200 added 1.9 percent to 4,058.20.

Benchmarks in Singapore, Taiwan and Thailand were also higher. Those in Indonesia and the Philippines fell. In mainland China, the benchmark Shanghai Composite Index gained 0.1 percent to 2,383.03.

German media reported over the weekend that German Chancellor Angela Merkel and French President Nicolas Sarkozy were studying legal changes - possibly amendments to the European Union growth and stability pact - to force nations using the euro common currency to comply with strict rules for budget discipline and tough sanctions for violators.

The reports raised hopes that the region may be able to stem a debt crisis that has infected peripheral countries like Greece and is threatening bigger countries like Spain.

Surprisingly strong Thanksgiving sales in the U.S. also helped boost market sentiment, said Francis Lun, managing director of Lyncean Holdings in Hong Kong.

A record 226 million shoppers visited stores and websites during the four-day U.S. holiday weekend starting on Thanksgiving Day, according to early estimates by The National Retail Federation. The results for the first holiday shopping weekend show that retailers' efforts to lure shoppers during the weak economy are working. Holiday shopping can account for 25 to 40 percent of a merchant's annual revenue.

But what really got markets going, Lun said, were Italian media reports that the International Monetary Fund was preparing up to 600 billion euros in loans for cash-strapped Italy, whose massive debts are becoming unmanageable because of soaring borrowing costs.

"It's a relief that we won't see the demise of the euro just yet. The end of the world is delayed for another week," he said. "The problem facing Europe now is that a lot of these smaller countries do not play by the rules. So now one by one, they are falling like dominoes, becoming satellites of Germany, at least in the economic sense."

But some analysts paid little heed to the report, saying the IMF simply could not afford such a loan.

"As of September the IMF had $385.5 billion of forward commitment capacity, so even if they designated their whole fund to Italy it would be well below the amount that has been speculated," Stan Shamu of IG Markets in Melbourne said in a report. "It would require huge increases in contributions from other nations."

Worries about Europe's debt crisis flared anew Friday after Italy had to pay 7.8 percent to borrow for two years at a debt auction. It's another sign that investors are increasingly hesitant to lend to European countries. Greece, Ireland and Portugal had to seek bailouts from international lenders when their interest rates crossed the 7 percent mark.

Gains in Asia were broad-based. South Korea's LG Electronics soared 8.6 percent, while Hynix Semiconductor added 7.1 percent. Hong Kong-listed Anhui Conch Cement gained 5.1 percent and China Railway Group was up 6.3 percent.

Japan's top three carmakers - Toyota, Honda and Nissan Motor Corps. - all posted gains of at least 2.9 percent.

But Olympus Corp., which is fighting to restore its reputation from a scandal involving the cover-up of huge investment losses, slid 10.6 percent. Australia's Woodside Petroleum fell 2.3 percent after downgrading its 2012 oil and gas production targets.

Shanghai-listed Chongqing Three Gorges Water Conservancy gained 6.8 percent while Sichuan Mingxing Electric Power Co. Ltd. rose 4.2 percent after a rumor said the authorities may raise electricity fees to combat higher coal costs.

During a shortened post-holiday trading session on Friday, the Dow fell 0.2 percent to close at 11,231.78. The S&P 500 lost 0.3 percent to 1,158.67. The Nasdaq composite dropped 0.8 percent to close at 2,441.51.

Benchmark crude for January delivery was up $2.32 to $99.12 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose $1.09 to finish at $98.01 per barrel on the Nymex on Friday.

In currency trading, the euro rose to $1.3332 from $1.3230 late Friday in New York. The dollar weakened to 77.66 yen from 77.76 yen.