European shares hit a one-week closing high on Tuesday after encouraging comments from some leading U.S. companies and hopes for more policy easing in China gave cyclical stocks a boost, with autos and miners among the top sectoral gainers.
While Chinese copper imports grew, helping to buoy miners, figures showing China's exports and imports grew at their slowest pace in more than two years in December increased hopes for more monetary policy easing from Beijing.
Chinese imports are slowing and that indicates that the country might start stimulating its economy and create some more liquidity for the entire world, said Philippe Gijsels, head of research at BNP Paribas Fortis Global Markets in Brussels.
People are putting cash into equities and the upward move could prolong a little bit as no one wants to miss the rally. But we need some confirmation to see that things are indeed improving. It's too early to call the bottom of the market.
Sectors linked with global growth rose, with the STOXX Europe 600 Automobile index <.SXAP> up 3.7 percent and the Basic Resources index <.SXPP> up 3.5 percent. The FTSEurofirst 300 <.FTEU3> index of top European shares provisionally finished 1.9 percent stronger at 1,027.63 points, the highest closing since January 3.
(Reporting by Atul Prakash)