Markets start year on upbeat note

World stock markets have started the year on a positive note, gaining ground after shares saw record falls in 2008.

London's FTSE 100 index rose 0.72% in early trade, while German and French stock indexes climbed more than 1%.

Hong Kong's Hang Seng index rose 4% and Indian shares climbed 0.9% in anticipation of a stimulus plan.

However, analysts said early gains might not be sustainable, with many market participants still on holiday and trading volumes likely to be low.

Bang or whimper?

"Many will be wanting to start the first trading session of 2009 with a bang," said Jimmy Yates, a dealer at CMC Markets.

But any meaningful direction may be hard to come by as both the economic and corporate calendars are looking very quiet," he added.

The FTSE 100 was up 31.91 points at 4,466.08 points in early morning trade on Friday. The index suffered its worst year on record in 2008 - a fall of 31.3%.

Germany's Dax index climbed 1.17% to 4,866.71 points and France's Cac 40 index was up 1.26% at 3,258.61.

In Asia, South Korea's main stock index closed up 2.9% at 1,157.40 points.

However, Australian stocks fell 0.2%.

Markets in Japan and China were closed for a public holiday.

Record falls

Global markets saw record falls in 2008 as the financial turmoil and economic slowdown ended the stock market boom.

Shanghai was one of the worst-hit major markets, ending the year 65% lower, which was also a record loss.

In New York, the Dow Jones lost almost 34% of its value in 2008, its worst year since 1931.

The year saw the credit crisis push several major economies into recession, with banks particularly badly hit - many requiring government bail-outs.

Whether the stock markets fall further in 2009 is a matter of debate.

Many investment strategists have written off any chance of a major rebound in at least the first six months of the new year, when company earnings could prove especially bleak.