"Uncertainty in markets is now starting to increase costs for developing countries," Zoellick said. "The ripple effects are making everybody's life harder."
In a reference to tensions in the eurozone over Greece's future, Zoellick said: "Europe may be able to muddle through but the risk is rising. There could be a Lehmans moment if things are not properly handled."
The bankruptcy of US bank Lehman Brothers in September 2008 triggered a global financial slump that indebted Western nations are still struggling to recover from.
Stocks rally on hope foreign banks ready for Greece election fallout - Denver Post
NEW YORK — U.S. stocks on Friday climbed to their first back-to-back weekly gain in more than a month, on optimism for action by global central banks to stabilize markets if needed after Greek elections.
"It's startling to see it move higher on the amazing amount of uncertainty that surrounds this Greek election Sunday," said Randy Frederick, managing director of trading and derivatives with the Schwab Center for Financial Research.
"This market has held up remarkably well on the specter of more quantitative easing, whether it's an official QE3 type of announcement or an extension of Operation Twist" — the Federal Reserve's bond-buying program, he added.
Up 1.7 percent for the week, the Dow Jones industrial average rose 115.26 points, or 0.9 percent, to 12,767.17.
The S&P 500 index climbed 13.74 points, or 1 percent, to 1,342.84, up 1.3 percent from the week-ago close.
The Nasdaq composite added 36.47 points, or 1.3 percent, to 2,872.80.
Friday marked the first back-to-back weekly rises for the Dow and S&P since April, and for the Nasdaq since the end of March.
Crude for July delivery gained 12 cents to end at $84.03 a barrel.
U.S. data Friday illustrated slowing global growth, with the nation's industrial output weakening in May and with a gauge of manufacturing activity in the New York region slumping in June.
"The industrial production numbers weren't good at all; neither were New York manufacturing. Part of the problem is the dollar has risen against the euro, that hurts exports," Frederick said.
The University of Michigan-Thomson Reuters consumer-sentiment index fell to a preliminary June reading of 74.1 from 79.3 in May.
"Market volatility trumps lower gasoline prices is my take on that," Frederick said of the mood of the American consumer.
The dollar fell against other global currencies, including the euro, while the 10-year Treasury note yield used in determining mortgages and other consumer loans fell to 1.582 percent.
Money laundering cases tough, critical - Lubbock Avalanche-Journal
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McALLEN — When it comes to arresting drug traffickers and dismantling organized crime, the investigation into a U.S. horse racing operation allegedly laundering money for one of Mexico’s most powerful cartels is rare — and difficult to ...MIDEAST STOCKS-Saudi rebounds, no impact from Nayef death - Reuters
DUBAI, June 17 |
DUBAI, June 17 (Reuters) - Saudi Arabia's main stock index rose on Sunday, recovering the previous day's losses as the death of the kingdom's crown prince ceased to have an impact.
Qatar's index was again weak and Bahrain steady, while markets in the United Arab Emirates, Kuwait and Oman were closed for a religious holiday. Egypt was also shut for the country's presidential election.
Saudi Arabia's benchmark rose 0.4 percent. It fell 0.3 percent on Saturday, having been down as much as 2.6 percent intra-day in a knee-jerk reaction to Crown Prince Nayef's death eight months after he became heir to the throne. The index is now down 14.8 percent from early April's 3-1/2 year peak, as declines in oil and world equity prices have spurred local selling.
"Yesterday's volatility was to be expected when we have this kind of news, but the market then recovered and I don't think it will be major factor today - Prince Nayef was known to have had health problems so his death wasn't a complete surprise," said a Riyadh-based fund manager, asking not to be identified.
"The authorities will probably give some clarity on the succession soon and today's trading will be more linked to what's happening outside the region."
Although Nayef was known for his strong management of security issues in the country, analysts see no reason to think foreign or political policies, much less economic policies, will change under his successor.
Gains in world markets on Friday helped support Saudi sentiment. Investors fear Sunday's Greek elections could unleash fresh turmoil in the euro zone if the next government in Athens scraps Greece's bailout deal, but this is offset by hopes that the world's major central banks will make a coordinated response to ease any market dislocation.
In Saudi Arabia, shares in telecoms operator Etihad Etisalat (Mobily) climbed 2 percent and Saudi Basic Industries Corp rose 0.8 percent. Saudi firms are expected to start announcing second-quarter earnings from early July.
"Q2 results will help at least to stabilise the market, but these will be of secondary importance compared with what's happening in Europe, which is flitting between risk-on and risk-off mode," said the fund manager.
"We should see some buying in select names ahead of results, particularly petrochemicals - people are expecting bad results, but not as bad as recent price movements would justify."
The petrochemicals index climbed 0.4 percent, trimming its year-to-date losses to 4.7 percent. The sector has loosely tracked declines in oil prices, with crude seen as a key indicator for both petrochemical product prices and likely demand.
QATAR
In Doha, the main index slipped 0.01 percent to its lowest close since Oct. 6. This took its 2012 losses to more than 6 percent, making it the worst performing Gulf Arab benchmark. About 1.83 million shares traded, the lowest total since July 2011.
"Volumes have been going down lately and I don't think it will get better anytime soon," said a Doha-based trader on condition of anonymity.
"Foreign investors have been selling aggressively to invest in other markets and Qatar trading has slumped - things look anaemic, with a lack of catalysts and better opportunities for investors elsewhere."
Vodafone Qatar fell 0.3 percent. The loss-making telecommunications operator is among the top-performing Doha-listed stocks this year, rising nearly 20 percent, but has fallen 2.5 percent since June 7, when it reported a fourth-quarter net loss of $35 million, missing an analyst's estimate.
NBK Capital last week cut its rating on Vodafone Qatar to hold from accumulate.
SUNDAY'S HIGHLIGHTS
SAUDI ARABIA
* The index rose 0.4 percent to 6,754 points.
QATAR
* The benchmark slipped 0.01 percent to 8,251 points.
BAHRAIN
* The measure rose 0.1 percent to 1,132 points.
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