Stock market activity across Europe rises modestly

Stock market results are looking up in Europe Tuesday, despite bad news about the global economic recovery.

By , Associated Press

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    Traders work at their desks at the Frankfurt stock exchange August 16. Stock markets across Europe posted only modest gains Tuesday, despite bad news about the global economic recovery.
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European markets posted only modest gains Tuesday as a steady drumbeat of bad news about the global economic recovery kept new bets on stocks in check.

An investor confidence survey in Germany disappointed investors, following news that Japan on Monday became the latest major economy to report slower growth in the second quarter.

In Europe, France's CAC-40 was up 0.9 percent to 3,631.72, Britain's FTSE 100 was higher by 0.1 percent at 5,275.44 and Germany's DAX added 0.8 percent to 6,161.70. Futures pointed to gains at the open later Tuesday on Wall Street with Dow futures up 55 points, or 0.3 percent, at 10,328.00. Broader S&P futures advanced 6.6, or 0.6 percent, to 1,083.70.

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Germany's ZEW institute's monthly confidence index fell more than expected on worries that slowing global growth may hurt the country's export-led recovery.

There was downbeat news on inflation in Britain, where rising prices continue to outpace the government's 2 percent target in July, with the biggest monthly jump in food prices in two years.

Investors were getting ready for a slew of economic data out of the U.S. later in the day, with July industrial production, housing starts, building permits and producer price inflation all set for release.

Oil prices edged above $75 a barrel in Asia for the first time in five days but gains were tempered by uncertainty about the strength of demand for fuel in the second half of the year.

Investors have been unnerved by figures showing the U.S. economic recovery is stumbling while China, which helped lead the world out of last year's recession, is also slowing as Beijing clamps down on credit to prevent overheating.

"The market has grown cautious as confidence in economic recovery waned. Nevertheless, an economic slowdown is unlikely to turn into a double dip recession," Daewoo Securities said in a report.

Among the advancers in Asia was China's Shanghai Composite Index, which added 0.4 percent to 2,671.89 and South Korea's Kospi, up 0.7 percent to 1,755.03. Hong Kong's Hang Seng rose 0.1 percent to 21,137.43.

Australia's S&P/ASX 200 climbed 0.9 percent to 4,477.00. Volume was light ahead of national elections on Saturday. Markets in India, Malaysia, Thailand and the Philippines also gained.

Sustained strength in the yen magnified lackluster sentiment in Japan, where the Nikkei 225 stock average fell 34.99 points, or 0.4 percent, to 9,161.68.

Japanese exporters, whose overseas earnings shrink when the yen climbs, came under selling pressure.

Elsewhere, Singapore's index lost 0.3 percent to 2,925.94 and Taiwan's benchmark slipped 0.1 percent to 7,931.09. New Zealand's market also fell.

In currencies, the euro climbed to $1.2878 from $1.2822.

Benchmark crude for September delivery was up 33 cents at $75.57 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 15 cents on Monday to settle at $75.24.

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