European stocks higher on Greece optimism; DAX gains 0.9%

Investing.com - European stock markets were broadly higher on Tuesday, as appetite for riskier assets was boosted amid signs of progress in talks between Greece and its bondholders.

During European morning trade, the EURO STOXX 50 jumped 1%, France’s CAC 40 rallied 1.1%, while Germany’s DAX 30 gained 0.9%.

European equities added to gains after official data showed that the number of unemployed people in Germany fell more-than-expected in January, while the country’s jobless rate dropped to a record low, easing concerns over the economic outlook for the region’s biggest economy.

Market sentiment was already firm after Greek Prime Minister Lucas Papademos said Monday that "significant progress” was made in talks aimed at restructuring the country’s debt, boosting hopes that a deal can be finalized before the end of the week.

Shares in the financial sector performed strongly. Italian lenders Unicredit and Intesa Sanpaolo saw shares climb 3% and 3.15% respectively, France’s BNP Paribas advanced 2.5%, while Germany’s Commerzbank saw shares gain 1.9%.

Spain’s Banco Santander underperformed after reporting that fourth quarter net profit plunged 98% after taking a EUR1.81 billion charge on its Spanish real estate holdings. The stock was up 0.5%.

In London, FTSE 100 rose 0.65%, boosted by upbeat earning reports from chip maker ARM Holdings and media giant BSkyB.

ARM, which supplies processors for Apple’s iPads and iPhones, saw shares rally 5.15% after saying that fourth quarter net profit rose 11% to GBP33 million. Sales rose to GBP137.8 million, a 21% increase from a year earlier.

British Sky Broadcasting Group saw shares rise 3.05% after reporting a 8.4% jump in first-half net profit. The broadcaster also announced that it would launch a new Internet-based pay-television service in the first half of 2012.
 
Raw material producers contributed to gains after oil and metal prices advanced. Oil giant British Petroleum saw shares climb 2.7%, while mining giants Rio Tinto and BHP Billiton rose 1.4% and 1.1% respectively.

In the U.S., equity markets pointed to a higher open ahead of earnings reports from oil major Exxon Mobil and pharmaceutical giants Pfizer and Eli Lilly.

The Dow Jones Industrial Average futures pointed to a rise of 0.45%, S&P 500 futures signaled a 0.4% increase, while the Nasdaq 100 futures indicated a 0.5% gain.

Later in the day, the U.S. was to release industry data on house price inflation, as well as a report on manufacturing activity in the Chicago region. The country is also to publish a report on consumer confidence.