Stocks across Europe rose strongly in early trade on Tuesday, tracking gains in Asia, amid speculation that China’s slowest economic growth in more than two years would lead to monetary easing.
The FTSE100 was up 1.08% to 5718.67 at 0941GMT , following good gains from mining and banking stocks.
Royal Bank of Scotland rocketed to the top of the leader-board, rising 4.2% to 25.43p after the state-owned lender announced the $7.3bn sale of its aircraft leasing business to Japan’s Sumitomo Mitsui.
Rio Tinto rose 2.3% after the world’s second largest mining group announced that fourth quarter iron ore production rose to a record 51.2m metric tons in the three months ended December 31, from $50m a year earlier. Shares in bigger peer BHP Billiton rose 2.4% to 2128.2. The company will publish its iron production figures tomorrow.
Gross domestic product in China, the world’s second-biggest economy, increased 8.9 percent in the fourth quarter from a year earlier, the statistics bureau said in Beijing. That beat the median of 26 economist estimates in a Bloomberg survey for growth of 8.7 percent.
The People’s Bank of China said it injected 169bn yuan ($26.8bn into the financial market through 14-day reverse-repurchase operations at 5.47%, according to a statement posted on the bank’s website today.
IMI rose 3% to 895p after BNP Paribas upgraded the shares to outperform as it raised estimates for the capital goods industry.
On the downside, Burberry dropped 1.5%, one of the few weak spots, after it warned about the challenging macro environment despite reporting fiscal third-quarter sales that beat analyst estimates.
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