Exchange traded funds pegged to the euro’s movements against the U.S. dollar rallied Monday after Germany and France pledged to deal with the Eurozone debt crisis before a key global summit.
German Chancellor Angela Merkel and French President Nicolas Sarkozy over the weekend said they would formulate a plan to recapitalize troubled European banks before a Group of 20 meeting in early November, according to reports.
CurrencyShares Euro Trust (NYSEArca: FXE) rose 1.8% in premarket action. PowerShares DB US Dollar Index Bullish (NYSEArca: UUP), an ETF tracking the dollar’s moves against a basket of currencies, slipped 1.3%.
Merkel and Sarkozy provided no concrete details of their plan to resolve the debt crisis, WSJ.com reported, adding the two leaders “have essentially asked financial markets to just trust them.”
Last week, Fitch downgraded its credit ratings on Italian and Spanish government bonds. [Fitch Downgrades]
The governments of France and Belgium agreed to nationalize Belgium’s largest bank, Dexia, on Sunday, The Washington Post reported.