Tuesday July 14, 09:56 AM
European equities power higher
LONDON (AFP) - Europe's main stock markets rallied on Tuesday, mirroring earlier gains in Asia and overnight on Wall Street, as investor optimism grew ahead of second-quarter results from US bank Goldman Sachs (NYSE: GS - news) .
European traders were also awaiting publication of the ZEW investor confidence index in Germany and key inflation data in Britain.
In morning European trade, London's FTSE 100 index of leading shares rose 0.66 percent to 4,229.95 points.
Frankfurt's DAX 30 (Xetra: news) gained 0.94 percent to 4,767.30 points and the Paris CAC 40 added 0.51 percent to 3,066.81.
The DJ Euro Stoxx 50 index of leading eurozone shares increased by 0.91 percent to 2,366.60 points.
On the foreign exchange market, the European single currency advanced to 1.4009 dollars.
"Quarterly results from Goldman Sachs ahead of the bell will kick off the round of numbers due from the big US banks this week," said CMC Markets dealer Matt Buckland.
Markets were also turning their attention to this week's other crucial results from rivals JPMorgan Chase, Bank of America (NYSE: IKJ - news) and Citigroup (NYSE: C - news) , as well as US inflation, manufacturing and housing reports.
Japanese share prices closed up 2.34 percent on Tuesday, snapping a nine-day losing streak after a powerful US rally. Hong Kong soared 3.66 percent in value.
Wall Street had posted a broad rally Monday after a key analyst upgrade of Goldman Sachs a day ahead of its quarterly earnings report ignited the financial sector.
The Dow Jones Industrial Average, which had closed lower Friday for four weeks running, surged 2.27 percent to finish at 8,331.68 points.
Analysts said bank stocks were underpinned after Goldman Sachs received an upgrade from influential Wall Street financial analyst Meridith Whitney.
"Goldman Sachs has entered a new found significance to the stock market over the past weeks," said Kevin McConnell, head of research at Bloxham stockbrokers in Dublin.
"With strong speculation that Goldman were heading toward bumper trading profits, today's results represent a very significant milestone for the market.
"Goldman led the investment banks strongly higher last night pushing the stock market to one of its best days, after four weeks of falling markets.
"Whitney gave Goldman Sachs a 'buy' recommendation yesterday, spurring investors into action ahead of the results today."
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