World stocks recovered some composure on Monday with emerging markets leading the way after a late Friday rally in banking shares on Wall Street ended what was otherwise a dismal week for equities investors.

The euro gave back some of the gains it managed at the end of last week and was lower against the dollar.

Global stocks as measured by MSCI <.MIWD00000PUS> were up 0.3 percent after losing 4.8 percent last week on worries about a slowing global economy and stresses in the euro zone.

Emerging markets stocks <.MSCIEF> were up 1 percent after losing 7.6 percent last week.

European trading was thin due to a religious holiday, but most markets were open. The FTSEurofirst 300 <.FTEU3> was up 0.8 percent.

There's some value-searching going on, even before the last correction the market wasn't over-priced, and investors are starting to realize there's some value to be had, said Richard Hunter, head of equities at Hargreaves Lansdown.

Equity markets have been battered recently, first by a fear that some European countries, notably Greece, were heading for a default on their sovereign debt and then about the impact of a debt rescue package on growth prospects.

Jun Kato, senior manager for investment at Shinkin Asset Management, said while the euro zone's fiscal trouble was still in focus, wariness about its impact on the global economy seems to be spreading.

Year-to-date, all major broad stock indexes are in the red, although U.S. equities are generally outperforming. This is a reaction both to a flight from Europe and growing signed of U.S. economic recovery.


The euro pulled back from a late rally on Friday with investors remaining wary of extending gains given fiscal problems plaguing some euro zone countries.

It hit a four-year low of $1.2143 hit last week, but then recovered somewhat.

On Monday, it was down around 0.4 percent at $1.2499.

Despite the modest rebound toward the end of last week, we expect to see further EUR/USD downside ahead as the euro zone fiscal deficit, public debt, and structural issues remain unresolved despite recent policy initiatives, UBS analysts said in a note.

Euro zone government bonds yields slipped. The two-year Schatz yield was down 3 basis points at 0.469 percent.

Oil snapped three straight sessions of declines and rose more than 1 percent toward $71 a barrel but analysts said sentiment remained fragile and prices could again be hit by macroeconomic pessimism.

(Additional reporting by Simon Falush and Naomi Tajitsu, editing by Mike Peacock)