Tribune newspapers | Stock prices took off on Thursday morning
after China reaffirmed its commitment to supporting Europe’s economy.
The Dow Jones industrial average shot up more than 200 points soon
after opening and stood near 10,200 at midmorning just a day after
closing under 10,000 for the first time since February.

The rise came after the Chinese government publicly denied reports that it was reviewing its holdings of European government bonds, which some media outlets had reported Wednesday.

The reports led to a late-day decline in share prices and fed into fear that economic problems in a few southern European countries could spread to the rest of Europe and the world.

But after China’s response Thursday, major European stock markets all rose in midday trading, as did the price of the euro. The leading French index was up 3.3 percent, and the leading German index up 3.2 percent.

The news out of China overshadowed some disappointing U.S. economic reports.

The gross domestic product rose less than anticipated during the first quarter and less than in the previous quarter, and first-time claims for unemployment fell less than expected.

Analysts had expected growth of 3.4 percent in the first three months of the year, according to a Bloomberg survey, but the Commerce Department reported that the economy had grown 3%.

For the last few weeks, bad news out of Europe had been overshadowing good domestic news. That trend reversed itself Thursday as a number of investors indicated that the stock market may have overreacted to previous bad news out of Europe.

The Standard & Poor’s 500 index was up 23.82 points, or 2.2 percent, to 1,091.84. The Nasdaq composite index was up 57.49 points, or 2.6 percent, to 2,253.38.