Markets relieved,but cautious on outlook

The Dow,however,was dragged lower by IBMs shares hitting a two-year low a day after reporting weaker than expected revenue. The Dow Jones industrial average fell 35.48 points or 0.23 per cent,to 15,338.35,the Samp;P 500 gained 7.97 points or 0.46 per cent,to 1,729.51 and the Nasdaq Composite added 17.334 points or 0.45 per cent,to 3,856.765.

Meanwhile,European shares inched higher on Thursday,steadying after a recent sharp rally,as investors shifted their focus onto corporate news following an eleventh-hour deal in Washington to avert a US debt default.

The FTSEurofirst 300 index of top European shares closed up 0.2 per cent at 1,268.09 points,having surged more than 3 per cent in the past week on expectations the US Congress would reach a deal before the October 17 deadline. The euro zones blue-chip Euro STOXX 50 index was down 0.2 per cent at 3,010.39 points,retreating from a 2-1/2 year high hit on Wednesday.

Weve got a bit of relief that its all out of the way but were still going to have to revisit it in two or three months time, CMC Markets senior market analyst Michael Hewson said. The Euro STOXX 50 Volatility index,Europes widely-used gauge of investor sentiment,dropped 9.5 per cent on Thursday to hit a three-week low. Earlier,Asian stocks fared better as they responded to the previous days broad rallies in the US and Europe. Japans Nikkei 225 rose 0.8 per cent to 14,586.51 while Seouls Kospi gained 0.3 per cent to 2,040.61. Hong Kongs rally faded and the Hang Seng fell 0.6 per cent at 23,094.88.