After weakness across the board in the previous session, European and US markets bounced back overnight.

In Europe the FTSE added 60 points (+1%) to settle at 5931, whilst the CAC (-1.4%) and DAX (+1.3%) enjoyed even stronger gains.

German and Italian manufacturing data came in better than expected, whilst UK manufacturing PMI also rose, raising hopes for further expansion in Q1.

It wasn't all good news however, with eurozone unemployment coming in at 10.7% versus an expected 10.4%.

In other news, the International Swaps & Derivatives Association announced that credit-default swaps tied to Greek debt won't be paid out after it was asked to rule whether part of the nation's $170 billion bailout was a credit event.

The group said the European Central Bank's exchange of Greek bonds for new securities exempt from losses being imposed on private investors hasn't triggered $3.25 billion of outstanding credit-default swaps.

Stateside, the Dow Jones firmed 28 points (+0.2%) to settle at 12980, whilst the S&P500 (+0.6%) and Nasdaq (+0.7%) fared even better.

Applications for jobless benefits decreased 2,000 in the week ended Feb. 25 to 351,000, Labor Department figures showed.

The number matches that in the Feb. 11 week, which was the lowest since March 2008. Economists forecast 355,000 claims, according to the median estimate in a Bloomberg News survey.

The Aussie dollar traded above US$1.08 briefly before peeling lower to settle below this level, whilst the Canadian dollar advanced to a five-month high against the greenback on optimism demand for raw materials will accelerate as the global economy expands.

Oil climbed for a second day as the US increased pressure on Iran to halt its nuclear program and improving economic data signalled that fuel use will grow.

Crude oil for April delivery rose $1.77 to settle at $108.84 a barrel on the New York Mercantile Exchange. Futures have dropped 0.8% this week after reaching a nine-month high of $109.77 on Feb. 24.

Base metal prices were mostly higher with the exception of zinc which fell 0.4%. Gold rose marginally after the prior session's sharp fall.

Perpetual (50c) and APM (5c) go ex dividend today.

Morning Market Watch: Bouncing Back is a post from: Australian Stock Report Market Pulse Blog