U.S. and European stocks rose on Monday on plans to enhance an arsenal to buoy European finances and gain tighter euro zone fiscal rules, but the euro slipped on fears the debt crisis may damage global growth.
The safe-haven dollar got support from uncertainty after the death of North Korean leader Kim Jong-il, which raised the prospect of instability in Asia.
The euro came under pressure after Fitch's warning on late Friday that it could downgrade France and six other euro zone countries because a comprehensive solution to the region's debt crisis is technically and politically beyond reach.
Wall Street opened higher, following rising European shares. Defensive stocks were in demand as the Fitch warning, worries about global growth and the death of the North Korean leader combined to turn investors away from riskier cyclical sectors.
But investor sentiment rose after European finance ministers pursued plans to enhance the International Monetary Fund's arsenal with 150 billion euros to raise its crisis-fighting capacity.
The market is doing pretty well this morning, and the support is coming from the fact that (EU ministers) are seeking to draw more financial support for the crisis though the IMF, said Peter Cardillo, chief market economist at Rockwell Global Capital in New York.
On Wall Street, the Dow Jones industrial average <.DJI> was up 49.34 points, or 0.42 percent, at 11,915.73. The Standard & Poor's 500 Index <.SPX> was up 3.93 points, or 0.32 percent, at 1,223.59. The Nasdaq Composite Index <.IXIC> was up 11.87 points, or 0.47 percent, at 2,567.20.
European stocks, as measured by the FTSEurofirst 300 Index <.FTEU3>, rose 0.6 percent. But MSCI's all-country world equity index <.MIWD00000PUS> was down around 0.2 percent.
The euro was down about 0.1 percent at $1.3026 versus the dollar after falling to an 11-month low last week of $1.2945. The dollar index <.DXY> traded near break-even.
U.S. government debt prices fell as gains in equity markets crimped the bid for safe-haven U.S. government debt.
The benchmark 10-year U.S. Treasury note was down 1/32, with the yield at 1.8525 percent.
Oil prices rose.
Brent crude futures were 92 cents up to $104.27 a barrel.
U.S. crude futures rose 47 cents to $94.00 a barrel.
(Reporting by Herbert Lash; Editing by Kenneth Barry)