NEW YORK-US stocks notched their first gain of the week yes­ter­day af­ter Spain an­nounced se­vere bud­get cuts in­tend­ed to con­vince the world that it can meet deficit-re­duc­tion tar­gets. It was the best day for the US mar­ket since Sep­tem­ber 13, when Fed­er­al Re­serve Chair­man Ben Bernanke an­nounced fur­ther steps by the cen­tral bank to speed the eco­nom­ic re­cov­ery. Stocks were al­so helped by spec­u­la­tion that the cen­tral bank of Chi­na will act soon to help the world's No. 2 econ­o­my. The Dow Jones in­dus­tri­al av­er­age climbed 72.46 points, or 0.5 per cent, to close at 13,485.97. It was the Dow's first gain in five trad­ing ses­sions. The Stan­dard & Poor's 500 in­dex, af­ter five days of de­clines, closed up 13.83 points, or just shy of one per cent, at 1,447.15. The Nas­daq com­pos­ite in­dex rose 42.90 points to 3,136.60.

Stocks rose 0.5 per cent in Japan and 1.1 per cent in Hong Kong. In Eu­rope, stocks came back from one of their worst days in months. The bench­mark stock in­dex fin­ished 0.7 per cent high­er in France and 0.2 per cent high­er in Ger­many and Britain. Bor­row­ing costs for fi­nan­cial­ly trou­bled Spain and Italy al­so edged down, a pos­i­tive sign. In the US the yield on the ten-year trea­sury note, rose 0.03 per­cent­age point to 1.65 per cent. The price of crude oil rose US$1.87 to US$91.85 per bar­rel as con­cerns mount­ed about a po­ten­tial mil­i­tary con­fronta­tion over Iran's nu­clear pro­gramme. Oil had dropped US$9 a bar­rel in two weeks.