European leaders took steps to calm fears about the EU debt crisis at the financial summit in Brussels. They agreed to use the continent's bailout fund to send money directly to struggling banks.
After tough all-night bargaining, European leaders appeared to salvage what had seemed to be a summit teetering towards failure. Their agreement not only funnels money directly to troubled banks, but it signals a tighter political union across Europe in the longer term.
The bailout announcement comes after Spain requested a hundred billion euros to rescue its banks.
European and Asian markets breathed a huge sigh of relief that Europe's leaders are still working together to resolve the deep debt crisis.
But Jackson Wong, vice president of Tanrich Securities in Hong Kong, cautioned that the euro crisis was far from solved.
"Don't expect a magical formula that can solve the problem right out from the EU summit," he said.
Meanwhile, in the United States, the Commerce Department reported that consumer spending showed no gain in May.
Economic experts say the weaker spending and a recent rise in unemployment are just the latest signs the U.S. economy is faltering, and could be heading toward a double-dip recession.