Improving world growth outlook lifts stocks and dollar
By Marc Jones
LONDON (Reuters) - Signs the global economy is starting to move up a gear pushed world share markets higher on Wednesday, while the dollar made gains in the wake of surprisingly strong U.S. consumer spending figures.
European stocks .FTEU3 had a fresh spring in their step as confirmation that private consumption in Germany picked up last year and looks set to help drive the economy this year, prompted the biggest rise of the year so far for Frankfurt's DAX .GDAXI.
The German benchmark's 1.3 percent gain was complimented by smaller but still significant gains on bourses elsewhere in the region, taking the FTSEurofirst 300 index .FTEU3 to a fresh 5-1/2 year high. .EU
"German consumption turned out to be especially robust last year," said Dekabank economist Andreas Scheuerle. "With the shackles of the sovereign debt crisis being loosened, this year should lead to considerably stronger growth."
Data confirmed that private consumption in Germany rose 0.9 percent in 2013, indicating an underlying strength in Europe's biggest economy even though headline GDP grew just 0.4 percent for the year.
Wall Street was seen opening up around 0.2 percent, with another flurry of earnings already in focus, as well as the NY Empire manufacturing survey, December PPI and Fed Beige Book data later. .N
Helping the better mood overall, the World Bank upgraded its forecast for global growth this year by two tenths of a point to 3.2 percent, and predicted a faster pace for both 2015 and 2016.
Its view was that the world economy had finally reached a "turning point" and though it trimmed forecasts for some developing nations, including China, overall emerging market growth was seen accelerating to 5.3 percent this year. Continued...