EUROPEAN UNION

U.S. oil prices shot to a 12-week high on Tuesday in a second day of frenetic spread trading, with dealers racing to claw back a record discount versus Europe's Brent as they gave in to evidence of tightening supplies.

Gold prices soared nearly three percent Tuesday as global investors fled stocks and the euro for safe-haven investments ahead of a critical European economic summit that many think will fail to fix the continent's debt and finance crisis.

Stocks fell on Tuesday after discouraging corporate outlooks cast a pall over the economy's outlook, while fresh doubts arose about European efforts to find a solution to the debt crisis.

With ongoing turmoil in Africa and the Middle East, illegal immigration is becoming an increasingly difficult challenge in Europe.

Toronto's main stock index turned higher on Tuesday morning, hitting a one-month peak and reversing steep losses in volatile trade as gold prices rallied following grim U.S. consumer confidence data.

The International Monetary Fund is considering taking part in a special investment vehicle being proposed by the euro zone bailout fund but has not made a decision yet, euro zone officials said on Tuesday.

A lack of steady progress in tacking the debt crisis raised pessimism among investors and the market.

Stocks fell on Tuesday on news that a meeting by euro zone finance ministers was canceled, adding to doubts about the region's efforts to tackle its debt crisis.

Italian Prime Minister Silvio Berlusconi faced growing pressure Tuesday over European Union demands for economic reforms with his main coalition partner warning the government could fall over the issue.

It would be easier to deal with the euro zone debt crisis if more firepower was available, European Central Bank Executive Board member Lorenzo Bini Smaghi said, calling for a backstop relative to the severity of the current troubles.

Ennahda has vowed it will not establish an Islamic state, but rather a secular, multi-party democracy.

Uncertainty about just how close European Union leaders will come to solving the euro zone debt crisis kept many markets trading in a tight range on Tuesday.

Many investors suffered a bout of pre-summit uncertainty on Tuesday a day before a crucial meeting of European Union leaders to solve the euro zone debt crisis.

While the humanitarian tragedy arising from the quake will not occupy the hearts, minds and bodies of the local population – the longer-term struggle between Kurds and Turks will likely not abate.

Outgoing European Central Bank President Jean-Claude Trichet called on Monday for euro zone authorities to have greater powers over the economic policies of the bloc's errant members, setting out a vision for a closer-knit currency area.

South African stocks closed at their highest level in nearly three months as demand for resources firms rose with hope that European Union leaders will agree on a solution to their region's debt woes later this week.

U.S. grain and soybean futures rose over 1 percent on Monday in a broad commodities rally as investors bet that European leaders would reach a deal to tackle a euro-zone debt crisis and took heart from an improved manufacturing indicator in China.

There are 27 nations in the European Union (EU), but only 17 members in the Eurozone – Britain is not in the currency bloc.

Eurozone authorities should in future have greater powers to influence the economic policies of countries in the bloc if a member persistently fails to meet economic targets, ECB President Jean-Claude Trichet said on Monday.

Angela Merkel's supporters praised her for getting France to drop demands to use the European Central Bank to leverage euro crisis funds, but looked like making a meal out of the German parliament's new right to be consulted on how these are used.

The European Union is now discussing two options for giving the euro zone rescue fund more firepower -- an insurance model and a special investment vehicle , a paper obtained by Reuters on Monday showed.