European leaders cajoled bondholders into accepting 50 percent writedowns on Greek debt and boosted their rescue fund’s capacity to 1 trillion euros ($1.4 trillion) in a crisis-fighting package intended to shield the euro area. The 17-nation euro and stocks climbed while bond spreads narrowed after leaders emerged early today from a 10-hour summit in Brussels armed with a plan they said points the way out of the quagmire, albeit with some details still to be ironed out. “Overall the outcome is better than we anticipated one week ago,”Laurent Bilke, global head of inflation strategy at ...

German lawmakers are set to back a planned increase in the European rescue fund’s capacity, removing one hurdle in the path of Chancellor Angela Merkel as she prepares for a summit on tackling the euro-area debt crisis. Merkel is due to address lower-house lawmakers on the crisis at about noon in Berlin today before the government puts plans to bulk up the 440 billion-euro ($612 billion) backstop to a vote. The coalition ensured cross-party support after persuading the main opposition Social Democrats and Greens to sign up to a motion that includes a ...

Italian, Portuguese and Spanish lenders will bear the brunt of a 100 billion-euro ($139 billion) plan to recapitalize European banks, while their counterparts in the U.K., Germany and France may avoid raising additional funds. European policy makers, trying to reach agreement before a meeting in Brussels tomorrow on how to tackle the euro zone crisis, may force banks to boost core Tier 1 capital to 9 percent of risk-weighted assets by the end of June, two people with knowledge of the talks said.UniCredit SpA (UCG), Italy’s largest bank, Banco Comercial Portugues SA (BCP), Portugal’s ...

Occupy Wall Street protests assailing income inequality, joblessness and big banks may have some unintended consequences. They’re hurting nearby merchants as police barricades deter shoppers. “If this doesn’t stop soon I will be out of business,” said Marc Epstein, 53, president of Milk Street Cafe on Wall Street, less than a block from the New York Stock Exchange. Sales have dropped about 20 percent since the protests began last month and the 103 jobs created by the cafe’s opening in June are now at risk, said Epstein, who’s not alone. Caroline Anderson, general manager of ...

Prime Minister David Cameron overcame the largest ever Conservative Party rebellion over the European Union as more than a quarter of his lawmakers voted in favor of a referendum on British membership of the bloc. Cameron defeated a non-binding parliamentary motion calling for a plebiscite by 483 votes to 111 in the House of Commons in London last night. About 80 of the lawmakers voting against the government were Tories, the leader of the house, George Young, told BBC television. Some rebels want Cameron to claw back powers from Europe if the EU needs to amend its treaties to accommodate bailouts for Greece, while others want to go as far as full withdrawal from the bloc. The showdown ...

European leaders ruled out tapping the European Central Bank’s balance sheet to boost the region’s rescue fund and outlined plans to aid banks, inching toward a revamped strategy to contain the Greece-fueled debt crisis. Europe’s 13th crisis-management summit in 21 months also explored how to strengthen the International Monetary Fund’s role. The leaders excluded a forced restructuring of Greek debt, sticking with the tactic of enticing bondholders to accept losses to help restore the country’s finances. “Work is going well on the banks, and on the fund and the possibilities of using the fund, the options are ...

Prime Minister Silvio Berlusconi will nominate Mario Draghi’s successor to head the Bank of Italy today, ending months of wrangling that highlighted the political paralysis hampering Italy’s response to the debt crisis. Berlusconi said Oct. 18 that European Central Bank Executive Council member Lorenzo Bini Smaghi, 54, was a possible nominee, the only candidate on his “shortlist” he mentioned by name. Berlusconi was expected to propose Bini Smaghi for the post, the Financial Times reported last night, citing unidentified government officials. The announcement, which Berlusconi said would be made today, comes ...

Spain’s credit rating was cut for the third time in 13 months by Moody’s Investors Service as Europe’s debt crisis threatens to engulf the nation. Moody’s yesterday reduced its ranking to its fifth-highest investment grade, cutting it by two levels to A1 from Aa2, with the outlook remaining negative. Standard & Poor’s downgraded Spain on Oct. 14 to its fourth-highest investment grade, and Fitch Ratings cut it to the same level on Oct. 7, the day it also downgraded Italy. “Moody’s is maintaining a negative outlook on Spain’s rating to reflect the downside risks from a potential...

China’s economy grew 9.1 percent in the third quarter from a year earlier, the slowest pace since 2009, driving stocks lower on concern that Europe’s debt crisis is dragging on the global recovery. The gain was less than the median estimate of 9.3 percent in a Bloomberg News survey of 22 economists and followed a 9.5 percent increase in the previous three months. The statistics bureau released the data in Beijing today. Asia’s benchmark stock index fell as much as 2.4 percent after China’s growth was limited by tighter credit and weaker demand from Europe, where Germany yesterday ...

Europe’s options for overcoming the debt crisis narrowed as Germanydoused expectations of a breakthrough at this weekend’s summit and central bankers balked at extended bond purchases. European stock futures signaled a second day of declines after German Chancellor Angela Merkel’s office knocked down what it called “dreams” that the Oct. 23 summit will be the last word in taming the crisis. Christian Noyer, head of France’s central bank, ruled out a ramping up of the European Central Bank’s bond-buying program as ...