MW: Europe stocks mostly higher, led by drugs, miners
U.S. futures up, with ISM data due later
By Barbara Kollmeyer, MarketWatch
MADRID (MarketWatch) — European stocks traded mostly higher Tuesday, with resource and pharmaceutical stocks leading the advance, and U.K. markets playing catch-up to a prior-day rally in the rest of the region.
The Stoxx Europe 600 index XX:SXXP +0.78% rose 0.5% to 248.50. The index closed up just more than 1% Monday, fueled by well-received German economic indicators. That was the biggest one-day percentage gain since Dec. 20.
London’s FTSE 100 index UK:UKX +1.44% reopened after Monday’s bank holiday to rise 1.1%, to 5,635, and was among the best performers in Europe.
Resource stocks drove the move, as crude and precious- and base-metals prices rose. Heavily weighted Rio Tinto PLC UK:RIO +5.86% RIO +5.44% jumped 5.3% and BHP Billiton PLC UK:BLT +5.97% BHP +5.37% up 4.5%.
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An official reading of China’s purchasing-managers index released Sunday was better than analysts had expected, with conditions showing growth against a prior contraction. Asia stocks also rose in reaction.
Mining stocks and commodities are sensitive to signs of growth in China, which is a big user of natural resources.
BP PLC BP +2.64% UK:BP +1.57% rose 1.3%. The energy group has filed U.S. court documents asking contractor Halliburton Co. HAL -0.75% to pay all cleanup costs related to the 2010 Gulf of Mexico oil spill, media reports stated. BP declined to comment, and Halliburton couldn’t be reached.
The German DAX 30 index DX:DAX +1.29% was off earlier highs but still up 0.8% to 6,125.35 on the heels of the prior day’s 3% rally. Automobile stocks such as Daimler AG DE:DAI +3.47% , up 2.2%; and BMW AG DE:BMW +3.47% , up 2.7%; and Volkswagen AG DE:VOW3 +2.70% , up 2%, advanced.
Research firm R.L. Polk & Co., predicted a 6.7% rise in cars and light trucks sold across the globe for 2012, led by demand from China, according to Bloomberg News.
Germany’s jobless numbers ease
Economic data were once again lending a hand to German stocks, after a survey showed the number of jobless in the nation fell in December, by more than analysts had predicted.
“That’s why Germany is outperforming Europe, but the day is long, and we’ll see how it turns out,” said Predrag Dukic, senior equity salesman at CM Capital Markets in Madrid.
Dukic said that while many traders will have returned by Tuesday, volumes will remain low until next week.
“The real trends for the year will emerge in the next couple of days and weeks,” added Philippe Gijsels, head of research at BNP Paribas Fortis Global Investors. “I’d be surprised if it were clear sailing from here and markets would shoot up without looking back.”
Keying on positive European sentiment, U.S. stock-market futures pointed to a sharply higher start for Wall Street, returning to action after Monday’s New Year holiday. Among items on tap, the Institute for Supply Management’s manufacturing report for December will likely grab attention.
