By Sara Sjolin, MarketWatch
LONDON (MarketWatch) -- European stock markets rebounded from
sharp losses on Tuesday, after better-than-expected U.S.
consumer-confidence data and as investors speculated the recent run
of weak Chinese data will prompt more easing measures from Beijing.
Soft German business-confidence data didn't ruin the positive
trading mood.
The Stoxx Europe 600 index gained 1.1% to 32791, partly
recovering from its biggest one-day percentage drop in more than
two weeks, posted on Monday.
Investors in Europe largely ignored weaker-than-expected German
business-confidence numbers, with the Ifo business-climate survey
falling to 110.7 in March. The Ifo Institute said confidence among
businesses in Europe's largest economy was bruised by the tensions
in Ukraine's Crimea region and the weakness in emerging-market
economies.
Philippe Gijsels, head of research at BNP Paribas Fortis Global
Markets, said that the market didn't worry about the numbers
because they were "not too hot, not too cold."
"If they were too hot there would be worries the ECB might not
add additional stimulus measures as markets are hoping. If they
were too cold there would have been worries of an economic
slowdown," he said.
Instead, the investing mood was boosted by hopes the weak
manufacturing PMI from China released on Monday would trigger new
easing measures to stabilize growth, Gijsels added. Mining firms,
which are sensitive to growth news from China, were among major
advancers on Tuesday.
Shares of Rio Tinto PLC (RIO) picked up 2.9%. BHP Billiton PLC
(BHP) added 1.9% and Glencore Xstrata PLC (GLCNF) advanced
1.7%.
Among other notable movers in Tuesday's actions, shares of
Kingfisher PLC , jumped 5.8% after the do-it-yourself retailer
reported a 5% rise in fiscal full-year adjusted earnings per share
and said it would return 200 million pounds ($330 million) to
shareholders in fiscal 2015.
EasyJet PLC climbed 4.5% after the budget carrier raised its
first-half guidance, citing benefits from cost cuts and its focus
on strategic priorities.
In Amsterdam, PostNL NV rallied 5.7% to 3.25 euros ($4.50) after
J.P. Morgan Cazenove lifted the courier to overweight from neutral.
The analysts said the recent pullback in the share price appeared
overdone, with the new price target of EUR4.20, down from EUR4.55,
implying 37% upside potential.
Luxottica Group SpA picked up 3.8% after the Italian eyewear
company said late Monday it has agreed to design, develop and
distribute new versions of Google Glass.
Germany's DAX 30 index climbed 1.4% to 9,313.31, while France's
CAC 40 index gained 1.3% to 4,331.73.
The U.K.'s FTSE 100 index advanced 1% to 6,583.49. Stocks in
London got a lift from data showing inflation dropped further below
the Bank of England's 2% target in February. Consumer prices rose
1.7% last month, the lowest level since October 2009, likely to
enable the BOE to keep its loose monetary policy for longer. Chris
Williamson, chief economist at Markit, said in a note that
inflation is likely to stay below target for some time, citing
lower import costs due to a stronger pound, as well as declining
energy prices.
"This means policy makers have greater leeway to keep interest
rates at the record low of 0.5% for longer, as the economy goes
through a 'sweet spot' of robust economic growth, falling
unemployment and low inflation," he said.
In the U.S., stocks traded higher after a gauge of consumer
confidence jumped to the highest level in more than six years.
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