Rally

Markets Soar on Italy Vote

After new austerity measures pass.

Global financial markets rallied Friday as investors reacted to the news that Greece and Italy were moving fast to deal with their debt crises. Leading stock indexes in Britain, France, Germany, and the U.S. all rose, with the Dow jumping 2 percent by midday while the value of the euro rose from $1.35 to $1.37. Italy’s senate approved the economic reforms demanded by the European Union, which could lead to Silvio Berlusconi’s ouster as early as this weekend, since the prime minister vowed to step down as soon as the reforms passed. Greece made similar moves to revamp its government, swearing in new cabinet leaders with strong financial backgrounds. Meanwhile, the yield on Italy’s 10-year bond dropped to 6.6 percent on Friday, having climbed past 7 percent at the height of the crisis.