The New Nation - Internet Edition

BBC, London

Global stocks suffered more turbulence on Wednesday as investors assessed yet more dramatic financial news.

The US government's rescue of troubled insurer AIG and a potential takeover of UK lender HBOS boosted confidence but markets were still volatile.

The FTSE 100 index of top UK shares was up 1.3% at 5,089.4 points, rising with other European markets.

Stocks in Tokyo, Taipei, and Seoul all rose, although prices in Hong Kong, Shanghai and Australia lost ground.

UK banking shares experienced the most volatile trading.

HBOS stock, which has faced heavy selling this week, fell as much as 50% before shooting into positive territory after the BBC learned that it was in advanced talks to be taken over by Lloyds TSB.

HBOS shares were up 4% at 189 pence by mid-morning.

Barclays was up 6.3%, Royal Bank of Scotland was up 3.3% and Lloyds TSB climbed 3.6%. All three had seen sharp falls in early trade.

Topsy-turvy trade

Trade is likely to remain rocky amid concern that financial system instability will continue after the dramatic events of the past few days.

AIG's bail-out follows the collapse of US investment bank Lehman Brothers, which caused share prices to plummet across the world's financial markets.

Another investment bank, Merrill Lynch, has been sold off to Bank of America.

France's Cac 40 index rose 0.7%, while Germany's Dax was up 0.4% after weaving in and out of negative territory.

Russia's stock exchange suspended trade following steep falls in shares.

Japan's Nikkei 225 index ended up 1.2% at 11,749.79, after hitting a three-year low on Tuesday. The index had earlier rose as much as 2.3%.

Hong Kong's Hang Seng index ended down 3.6% at 17,637.19 points.