By Riva Gold

European stocks climbed Tuesday alongside the euro as a key measure of German business sentiment surged to a record in July.

Data Tuesday showed the German Ifo business climate index beat analysts' expectations, with the institute describing the mood among German companies as "euphoric." The Stoxx Europe 600 was up 0.5% in morning trading, with banks, insurance companies and miners leading much of the advance.

A modest rise in government bond yields supported financial shares as such moves tend to boost lending income. German 10-year bond yields edged up to 0.512% from 0.497% Monday, while 10-year Treasury yields rose to 2.264% from 2.253%. Yields move inversely to prices. The euro climbed 0.1% to $1.1654 after the data, trading close to its near-two-year high.

"A strong economy is causing a strong euro," said Peter Elston, chief investment officer at Seneca Investment Managers. While it won't help exporters, many European companies are still likely to benefit from falling unemployment and stronger growth in the region, he said.

Miners in Europe and Australia were also supported Tuesday by rises in Chinese iron-ore futures and base-metals prices. Copper futures hit their highest levels since March amid optimism about Chinese demand and possible supply worries, and were up 1.7% at $6,136 a ton.

Shares of Jimmy Choo PLC were up around 17% after luxury-fashion company Michael Kors Holdings reached a deal to buy it for GBP896 million ($1.17 billion).

In the U.S., futures pointed to an opening gain of less than 0.1% for the S&P 500 after a quiet session Monday. Shares of Google parent Alphabet Inc. fell around 3% in premarket trading after reporting second-quarter earnings late Monday. The stock had gained around 26% so far this year and expectations were high ahead of the results.

Earlier, Australia's S&P/ASX 200 added 0.7%, handily outperforming stock markets in the region, following a weak session on Monday. Major banks and mining companies led the advance, while shares there also drew some support from a climb in oil prices.

Brent crude oil was last up 0.9% at $49.27 a barrel following pledges from Saudi Arabia and Nigeria to curb exports and output, respectively.

Indexes in Japan, Hong Kong and Taiwan were barely changed from Monday's closing levels while South Korea's Kospi fell 0.5% from a record.

In currencies, the WSJ Dollar Index was flat as many investors appeared to be taking a wait-and-see approach ahead of Wednesday's statement from the Federal Open Market Committee. Economists expect no change in the fed funds target rate, though some have speculated the central bank could announce the start date of its balance sheet runoff.

Razak Musah Baba, Nina Adam and Ese Erheriene contributed to this article.

Write to Riva Gold at riva.gold@wsj.com

(END) Dow Jones Newswires

July 25, 2017 05:32 ET (09:32 GMT)

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