Europe Debt | featured news

The next tranche of rescue loans for Greece will be withheld until after a bailout referendum, expected in early December, European leaders warn.

NEW YORK (Reuters) - Stocks tumbled on Tuesday after investors were blindsided by a surprise call for a Greek referendum on an EU bailout plan, casting doubt on the sustainability of the recent market rally.

The Federal Bureau of Investigation plans to examine MF Global Holdings Ltd amid concerns about missing client funds at the futures brokerage, the Wall Street Journal said Tuesday, citing a person familiar with the matter.

The Wall Street firm run by former Goldman Sachs Chairman and New Jersey Gov. Jon Corzine filed for bankruptcy Monday morning, making it the first big American casualty of the European debt crisis.

It is up to Silvio Berlusconi to keep Italy from becoming another Greece and plunging the world into an even more devastating financial crisis.

The Dow Jones industrial average closed up 339 points Thursday after European leaders unveiled a financial rescue plan and the data showed the U.S. economy growing at a faster clip in the third quarter than earlier in the year.

Stocks jumped more than 2 percent at the open on Thursday after European leaders agreed to boost the region's bailout fund and struck a deal with banks and insurers to accept 50 percent losses on Greek bonds.

European leaders “have risen to the challenge,” German Chancellor Angela Merkel said. French President Nicolas Sarkozy proclaimed their July 21 summit a “historic turning point” and Luxembourg Prime Minister Jean- Claude Juncker called it the “final package, of course,” to extinguish the debt inferno. Then they went on vacation. Before they returned to work, the deal fizzled.

The country that seems to crop up more and more in the current eurozone discussions is Italy, but why should it be affected by the Greek crisis?

European Union leaders made some progress toward a strategy to fight the euro zone's sovereign debt crisis on Sunday, nearing agreement on bank recapitalization and on how to leverage their rescue fund to try to stop bond market contagion.