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Germany Stocks Soars over 10% on Gov't's Debt Guarantee

German stock benchmark DAX soared over 10 percent on Monday over the confidence-building move that Hypo Real Estate Holding AG received a 20 billion-euro (about US$25 billion) debt guarantee from the German government.

This is the biggest jump for German stocks in almost four weeks during which the stocks had plummeted sharply over worries about economic recession resulting from global financial crisis.

Dax, the benchmark index of 30 big listing companies at Frankfurt Stock Exchange, soared 426.92 points, or 10.34 percent, to 4,554.33 when the exchange closed its Monday trading at 5:45 PM local time (1645 GMT). This is the steepest one-day advance since October 28 in Frankfurt.

Hypo Real Estate, German property lender bailed-out last month, rallied 21 percent. Deutsche Boerse AG advanced 10 percent after buying back shares. ThyssenKrupp AG gained 14 percent after the Financial Times Deutschland said Germany's largest steelmaker plans to cut about one billion euros of costs.

Observers believe that the jump is also partly fueled by the news that US lawmakers pledged to pass a economic stimulus package by January.

For other two key indexes for German stocks, MDAX, the index of medium-sized firms, rallied 387.61 points, or 8.19 percent, to 5,122.91.

The TecDAX, the index of technology companies, gained 33.51 points, or 7.75 percent to 465.99.

(Xinhua News Agency November 25, 2008)

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