Upbeat factory data buoys European shares, euro
By Richard Hubbard
LONDON (Reuters) - European shares and the euro strengthened on Tuesday on news of a surge in factory output in Britain and Germany, while Australia cut interest rates to ease the strains on its economy.
Wall Street, however, was set for a mixed start with the main share indexes hovering below record highs as investor await clues to whether the Federal Reserve will start to scale back its stimulus soon. .N
The strong growth at factories in Europe's largest economy, and in Britain, the euro zone's biggest trade partner, in June extended a run of recent upbeat data which points to an early end to the currency bloc's 18-month recession.
Though analysts were quick to stress the region was far from seeing the kind of recovery underway in the United States.
"We think that austerity as well as a financial system that is not willing to lend money to companies will still suppress growth for a longer time," Ronald Doeswijk, chief strategist at fund managers Robecco.
The data put Europe's broad FTSEurofirst 300 index on course for a seventh straight day of gains as it rose 0.2 percent .FTEU3, although the UK's FTSE 100 index .FTSE ended the morning session slightly easier, down 0.1 percent.
In the currency markets both the British pound and the euro reversed early weakness to gain on the dollar after the data with sterling settling little changed at $1.5350 and the single currency edging up 0.15 percent to $1.3280.
Germany said industrial orders at its factories surged by a surprisingly strong 3.8 percent in June, their largest monthly rise since October as contracts for big-ticket items jumped and euro zone demand rebounded. Continued...