The Aussie market rallied strongly last week after EU leaders struck a deal that could potentially put an end to the region's debt crisis.

The ASX 200 soared 211 points (+5.1%) for the week, closing at 4353.

Resource stocks were the week's big movers amid hopes the EU deal will lead to a pickup in global economic growth.

Easing fears over falling iron ore prices buoyed the bigger miners; BHP (ASX:BHP) rose 8.4%, Rio Tinto (ASX:RIO) flew 12.2% and Fortescue jumped 17.6%.

The energy majors got a big lift from surging oil prices; Woodside climbed 7.8% and Santos (ASX:STO) advanced 8.9%.

The big banks were stellar performers, with NAB (ASX:NAB) leading the charge (+6.9%) after reporting an FY11 cash profit of $5.5 billion.

It was a mixed bag among the retailers, with Billabong flying more than 20% after a forecasting a brighter FY12.

However Woolworths and Pacific Brands fell more than 1% after warning of still difficult trading conditions.

Economics

The key economic even last week was September quarter CPI.

Although headline CPI matched expectations of a 0.6% rise on the quarter, the trimmed figure of 0.3% came in below estimates.

Annualised trimmed CPI came in at 2.3%, which was comfortably within the RBA's 2% – 3% target band.

Given the recent economic and market volatility, the RBA may now feel it can cut rates without renewing inflationary pressures.

The central bank is scheduled to make its decision tomorrow at 2:30pm, AEST, with most economist tipping a 25 basis point cut in the official rate.

Overseas

A potential resolution to Europe's debt crisis fuelled big gains across the international indices last week.

On Wednesday, EU leaders outlined a plan that would force banks to recapitalise by June 2012, and expand the EFSF to more than 1 trillion euros, with potential backing from China.

That triggered an intense rally on European markets, with the FTSE up 3.9%, the Dax soaring 6.3% and the CAC jumping 5.6%.

The major US indices received an added boost from surprisingly strong GDP and consumer confidence data; the Dow, S&P500 and Nasdaq shot up more than 3.5% each.

Strong Chinese manufacturing data eased fears of a slowdown in Asia, and sent regional bourses surging. The Hang Seng flew 11.1%, the Shanghai Composite put on 6.7% whilst the Nikkei added 4.3%.

Commodities also bounced higher amid renewed risk appetite and a brightening outlook for the global economy.

Gold and oil tacked on almost 7% for the week, whilst copper and silver skyrocketed more than 13% each.

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Weekly Investors Markets Wrap: October 31 is a post from: Australian Stock Report Market Pulse Blog