Markets volatile as Europe turns away from austerity

Asian markets were badly hit on Monday by the results of the elections in France and Greece over the weekend. AFP/CNA reports:

Asian markets and the euro tumbled on Monday after voters in France and Greece voted out their ruling parties in a backlash against austerity measures aimed at battling the eurozone crisis...

France's Nicolas Sarkozy was on Sunday dumped out by Socialist Francois Hollande, who had campaigned on a platform of boosting growth instead of introducing huge spending cuts to overcome the country's deficit...

In Greece the two main parties -- the conservative New Democracy and the left-wing Pasok -- suffered huge losses in a general election, with those opposed to more cuts winning almost 60 percent support.

The Japanese stock market was hit particularly hard, falling 2.8 percent on Monday.

Western stock markets, however, managed to reverse early losses by the end of the day. The S&P 500 ended flat with most stocks rising while the STOXX Europe 600 even managed a gain of 0.7 percent.

While investors were focused on political developments, there was actually a positive piece of economic news from Europe on Monday. German factory orders jumped 2.2 percent in March, much higher than the 0.5 percent increase expected by economists surveyed by Bloomberg.