Berlusconi resignation pledge boosts global markets

Global markets received a much needed shot in the arm overnight as Italian prime minister Silvio Berlusconi's resignation offer reassured investors an end to the country's problems may be in sight.

Berlusconi pledged to step down after the Italian parliament passes the austerity package required by the European Union. Yesterday, he failed to secure backing from a majority of voters in the Chamber of Deputies leading to calls for his resignation.

Markets responded positively to the news with the Dow Jones industrial average up 102 points to 12,170, the S&P 500 rising 15 to 1,276 and the NASDAQ Composite advancing 32 to 2,727.

In Asia, the MSCI Asia Pacific index rallied 1.3% at 4 pm in Tokyo while the Hang Seng jumped 2.6%. Japan's Nikkei 225 Stock Average added 1.2%.

Figures were also released showing China's consumer price inflation cooled to 5.5% in October from 6.1% the previous month, while producer prices fell by more than economists had forecast, signaling the government may be able to reduce measures to cool its economy.