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European stocks gain on euro zone, China PMI data; DAX adds 1.81%

Published 08/23/2011, 06:37 AM
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Investing.com – European stock markets were higher on Tuesday, after readings of manufacturing activity in the euro zone and China bolstered risk appetite, while hopes for fresh stimulus measures for the U.S. economy also lifted markets.

During European morning trade, the EURO STOXX 50 jumped 1.61% France’s CAC 40 rallied 1.91%, while Germany’s DAX 30 advanced 1.81%.

The DAX’s gains came after data showed that Germany’s manufacturing purchasing managers’ index remained unchanged at 52.0 in August, beating forecasts for a decline to 50.8.

Earlier, a preliminary reading of the HSBC's China PMI inched up to 49.8 in August, from a final reading of 49.3 the previous month. The data eased investor concerns over a ‘hard landing‘ in the world’s second largest economy.

The PMI data overshadowed a report showing that German economic sentiment fell sharply in August, as fears over the outlook for global growth weighed.

Lenders were broadly higher with shares in Switzerland’s UBS AG adding 1.60% after the bank said it planned to cut approximately 3,500 jobs as part of a plan to reduce annual costs.

In London, the commodity heavy FTSE 100 gained 1.25% amid bargain hunting prompted by recent falls, while miners were among the top performers following China’s PMI data.

Chilean miner Antofagasta climbed 1.4%, while rivals Rio Tinto added 1.45% and Xstrata advanced 2.31%.

The outlook for U.S. equity markets was bullish. The Dow Jones Industrial Average futures pointed to a gain of 1.37%, the S&P 500 futures jumped 1.63%, while the Nasdaq 100 futures indicated a gain of 1.39%. 
   
Later Tuesday, the U.S. was to release official data on new home sales.

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