European stocks rise on E.Z. hopes; DAX up 0.63%

Investing.com - European stocks were higher on Tuesday, as market sentiment improved amid hopes for progress in tackling the euro zone’s financial woes following comments by a German official on the European Central Bank’s bond purchasing program.

During European morning trade, the EURO STOXX 50 climbed 0.74%, France’s CAC 40 rallied 0.75%, while Germany’s DAX 30 advanced 0.62%.

In an interview with The Telegraph newspaper on Tuesday, the German member of the ECB’s Executive Board, Jörg Asmussen, indicated that he would support the bond purchasing program proposed by ECB head Mario Draghi, in spite of warnings from Germany’s central bank.

In its monthly report on Monday, Germany’s Bundesbank reiterated its opposition to the ECB’s plan to embark on “unlimited" government bond purchases.

The ECB dismissed reports Monday that it may set a cap on peripheral euro zone bond yields, saying it was "absolutely misleading" to report on decisions that have not yet been taken.

Market participants were also anticipating the minutes of the Federal Reserve’s August policy meeting later in the week, amid speculation over how close the U.S. central bank may be to implementing another round of stimulus measures.

Financial stocks were broadly higher, led by Italian lenders Intesa Sanpaolo and Unicredit, up 2.63% and 1.96% respectively.

France’s Societe Generale and BNP Paribas also added to gains, with shares rallying 1.54% and 1.51%, while German lenders Deutsche Bank and Commerzbank advanced 0.99% and 0.48%.

On the downside, Lindt & Sprungli tumbled 1.81% after saying that Europe’s chocolate market remained “flat” in the first half of 2012.

In London, FTSE 100 advanced 0.59%, ahead of a report on public
sector net borrowing in the U.K.

Oil and gas major Anglo American was one of the session’s top gainers, with shares soaring 2.05%, while mining companies Polymetal and Evraz rallied 2.91% and 2.68%.

Rio Tinto and BHP Billiton were also sharply higher, climbing 1.83% and 1.69% respectively, while copper producer Xstrata fell 0.26%, amid expectations for Glencore to stick to its USD30 billion offer for Xstrata on Tuesday.

The company was expected to report first-half profits dented by falling prices, dashing hopes of an improved offer for now.

In the financial sector, stocks were broadly higher. Shares in the Royal Bank of Scotland rallied 1.96% and Barclays advanced 1.65%, while Lloyds Banking and HSBC Holdings climbed 0.99% and 0.44%.

In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to a 0.29% rise, S&P 500 futures signaled a 0.31% increase, while the Nasdaq 100 futures indicated a 0.32% gain.

Trade looked likely to remain subdued on Tuesday, with no significant economic data releases on the calendar, while volumes were light with many market participants on summer holidays.