Investing.com – European shares rocketed higher Tuesday, as stronger than expected German confidence numbers and increased demand for Spanish debt fuelled the risk on trade.
At the close of European trade, the EURO STOXX 50 gained 2.86%, France's CAC 40 advanced 2.72%, while Germany’s DAX soared 2.65%. Meanwhile, in the U.K. the FTSE 100 gained 1.78%.
Sparking the risk on trade, the debt crisis eased after an auction of Spanish short-term government bonds saw the country raise the full targeted amount of EUR3 billion, but at sharply higher yields.
Despite the positive signal, worries persisted amid uncertainty over whether Spain’s government can meet deficit reduction targets.
Adding to the bullish sentiment, data indicated that German economic sentiment improved unexpectedly in April, rising for the fifth consecutive month.
The ZEW Centre for Economic Research reported that its index of German economic sentiment increased to 23.4 in April from the previous month’s reading of 22.3. Analysts had expected the index to decline to 20.0.
Meanwhile in the U.S., government data indicated industrial production was unexpectedly flat for the second consecutive month in March, missing analyst’s expectations for a 0.3% increase.
Additional government data showed that the number of building permits issued in the U.S. surprisingly increased in March, rising to the highest level since September 2008, while housing starts dropped significantly, painting a mixed picture of the U.S. housing sector.
The number of building permits issued last month climbed 4.5% to a seasonally adjusted 0.747 million, confounding expectations for a modest decline of 0.7% to 0.710 million.
However, U.S. housing starts fell to the lowest level since October, dropping 5.8% to a seasonally adjusted 0.654 million from a revised 0.694 million units in February. Economists had forecast housing starts to rise 1.0% in March to 0.705 million units.
In other equity bullish news, the International Monetary Fund increased its global growth forecast from 3.3% to 3.5% jump starting the risk on equity trading.
Greece also helped the bullish sentiment as Prime Minister, Lucas Papademos stated that the government is close to completing its plans to restructure the struggling countries banks.
Banks climbed with EFG Eurobank Ergasias soaring 7.3% and National Bank of Greece adding 1.1% on the Greek news.
Sky Deutschland advanded 6% as the broadcaster won rights to Germany’s Bundesliga soccer matches.
In bearish news, clothier Burberry Group gave back 6.1% after reporting fiscal fourth quarter results missing analyst’s estimates.
U.S. stocks are following higher with the Dow up 1.39%, the S&P 500 higher by 1.37% and the Nasdaq surging 1.69%.
Traders are anticipating the Canadian monetary policy report, U.K.’s MPC meeting minutes, and claimant count change on Wednesday.
At the close of European trade, the EURO STOXX 50 gained 2.86%, France's CAC 40 advanced 2.72%, while Germany’s DAX soared 2.65%. Meanwhile, in the U.K. the FTSE 100 gained 1.78%.
Sparking the risk on trade, the debt crisis eased after an auction of Spanish short-term government bonds saw the country raise the full targeted amount of EUR3 billion, but at sharply higher yields.
Despite the positive signal, worries persisted amid uncertainty over whether Spain’s government can meet deficit reduction targets.
Adding to the bullish sentiment, data indicated that German economic sentiment improved unexpectedly in April, rising for the fifth consecutive month.
The ZEW Centre for Economic Research reported that its index of German economic sentiment increased to 23.4 in April from the previous month’s reading of 22.3. Analysts had expected the index to decline to 20.0.
Meanwhile in the U.S., government data indicated industrial production was unexpectedly flat for the second consecutive month in March, missing analyst’s expectations for a 0.3% increase.
Additional government data showed that the number of building permits issued in the U.S. surprisingly increased in March, rising to the highest level since September 2008, while housing starts dropped significantly, painting a mixed picture of the U.S. housing sector.
The number of building permits issued last month climbed 4.5% to a seasonally adjusted 0.747 million, confounding expectations for a modest decline of 0.7% to 0.710 million.
However, U.S. housing starts fell to the lowest level since October, dropping 5.8% to a seasonally adjusted 0.654 million from a revised 0.694 million units in February. Economists had forecast housing starts to rise 1.0% in March to 0.705 million units.
In other equity bullish news, the International Monetary Fund increased its global growth forecast from 3.3% to 3.5% jump starting the risk on equity trading.
Greece also helped the bullish sentiment as Prime Minister, Lucas Papademos stated that the government is close to completing its plans to restructure the struggling countries banks.
Banks climbed with EFG Eurobank Ergasias soaring 7.3% and National Bank of Greece adding 1.1% on the Greek news.
Sky Deutschland advanded 6% as the broadcaster won rights to Germany’s Bundesliga soccer matches.
In bearish news, clothier Burberry Group gave back 6.1% after reporting fiscal fourth quarter results missing analyst’s estimates.
U.S. stocks are following higher with the Dow up 1.39%, the S&P 500 higher by 1.37% and the Nasdaq surging 1.69%.
Traders are anticipating the Canadian monetary policy report, U.K.’s MPC meeting minutes, and claimant count change on Wednesday.