By Sara Sjolin, MarketWatch
LONDON (MarketWatch) -- European stock markets moved firmly
higher on Tuesday as the U.S. fiscal standoff took a new turn with
a bill proposal from Republican lawmakers and as Germany's DAX 30
index flirted with an all-time high after upbeat data.
The Stoxx Europe 600 index rallied 0.8% to 314.68, on track for
the highest closing level in almost a month.
Among notable movers in the index, shares of Rio Tinto PLC (RIO)
gained 3.7% after the heavyweight miner said its iron-ore output
rose to a new quarterly record.
Shares of Burberry Group PLC (BURBY) lost 5.9% after Apple Inc.
(AAPL) named the luxury-goods firm's Chief Executive Angela
Ahrendts as senior vice president of retail and online stores.
More broadly, investors in Europe welcomed developments in the
fiscal negotiations in U.S., with the debt-ceiling looming and the
government shutdown moving into Day 15. On the Senate floor on
Monday, Senate Majority Leader Harry Reid said he was "very
optimistic" about concluding deals "this week" to raise the debt
limit as well as end the government shutdown. Sen. Mitch McConnell,
the minority leader, said he shared Reid's feeling that "we'll get
a result that's acceptable to both sides."
On Tuesday, media reports said House Republicans will push for a
separate bill containing the same extensions to the debt ceiling
and budget, but delays the medical-device tax for two years and
turns off the Treasury's capability to use so-called extraordinary
measures.
U.S. stocks rose on Monday, but traded lower on Tuesday. Asia
markets closed mostly higher.
German ZEW data
German data further provided investors with a reason to
celebrate. The ZEW sentiment survey showed that the economic
expectations indicator rose further above its long-term average in
October, to 52.8 points from 49.6 points in September--beating
economists' expectations for an unchanged reading.
Germany's DAX 30 index jumped 0.9% to 8,801.21, on track for the
highest close on record.
The U.K.'s FTSE 100 index picked up 0.7% to 6,553.63, while
France's CAC 40 index rose 0.8% to 4,256.63.
Shares of Ashtead Group PLC climbed 1.9% after J.P. Morgan
Cazenove lifted the equipment-rental company to overweight from
neutral.
Man Group PLC rallied 5.3% after UBS added the investment firm
to its most-preferred list. In the same vein, UBS added Schroders
PLC to its least-preferred list, sending the shares 0.5% lower.
Shares of Zurich Insurance Group AG added 1.4% after J.P. Morgan
Cazenove upgraded the firm to neutral from underweight.
Stora Enso Oyj climbed 4.2% after Goldman Sachs lifted the pulp
and paper firm to buy from neutral.
On a more downbeat note, shares of Schindler Holding AG slumped
5.8% after the elevator maker warned full-year profit will come in
lower than previously estimated.
SKF AB dropped 4.9% after the Swedish ball-bearing maker posted
weaker-than-expected third-quarter net profit, as currency
headwinds hit the results.
Subscribe to WSJ: http://online.wsj.com?mod=djnwires