World stock markets rise on US Fed stimulus plan

European share markets have jumped after the US Federal Reserve moved to kick-start recovery by pumping more money into the economy.It followed the Feds decision on Thursday to inject $40bn (£25bn) a month into the US economy.UK, German and French stocks rose 2% in afternoon trading after rises in Asia.But fears over the global economy persisted as the International Monetary Fund and European Central Bank denied they were in bailout talks with Spain.Eurogroup finance ministers are meeting in Nicosia in Cyprus for talks on measures to end the current eurozone debt crisis.The European Stability Mechanism (ESM) - originally due to launch in July - would control up to 700bn euros.The ESM is an essential part of a European Central Bank plan to buy bonds from indebted governments such as Spain and Greece in order to bring down their cost of borrowing.Countries such as Spain would need to make a formal request to the ESM for help before the ECB could intervene.However, IMF chief Christine Lagarde and an ECB spokesperson strenuously denied reports that they were in talks with Spain about a rescue: I can assure you we are not, Ms Lagarde told reporters in Nicosia.Mr Juncker added that there would be no decision on the next steps in Greeces EU and IMF bailout before the end of October.The plan to buy up US mortgage debt will continue until further notice, the Fed said on Thursday. The central bank also kept interest rates at below 0.25%.The aim is to reduce long-term borrowing costs for firms and households. On Wall Street on Thursday, the Dow Jones index closed up 1.55%. On Friday, Hong Kongs Hang Seng added 2.7% and Japans Nikkei 225 rose 1.8%.Investors hope the Feds measures will revive growth in the US economy, the worlds biggest and a key market for Asian and European exports.The Feds promise that the quantitative easing programme was open-ended and would continue until the US economy showed signs of recovery has bolstered confidence, said analysts.There have been growing fears about the global economy, with a weak recovery in the US and the continuing debt crisis in the eurozone.The Federal Reserves announcement came days after the European Central Bank (ECB) announced its new unlimited bond-buying programme.