(RTTNews) - The major European markets are likely to open modestly higher on Tuesday on the back of strong Wall Street and Asian cues amid optimism about quarterly results of U.S. banks. Encouraging British retail sales data and news from the beleaguered housing market may also help stocks add to their previous session's gains.
Housing market sentiment in Great Britain improved to a 21-month high in June, according to the latest survey results from the Royal Institution of Chartered Surveyors. The Institute said Tuesday that its topline house price balance improved to minus 18.1 in June from a revised reading of minus 43.8 in May.
Separately, total retail sales in the United Kingdom jumped 3.2 percent year-over-year in June after falling 0.8% in May, the British Retail Consortium said on Tuesday.
Investors also look forward to British consumer prices and DCLG house prices reports for more insight on the state of the domestic economy.
At 5.00am ET, German ZEW survey and Eurozone industrial production reports are expected. German ZEW economic sentiment is expected to rise to 47.8 in July from 44.8, while current situation is predicted to improve to minus 88 from minus 89.7. Economists predict Eurozone industrial output to grow 1.5% in May from the prior month, while see another 17.5% annual decline.
Asian stocks rose sharply on Tuesday, aided by the overnight surge on Wall Street. An upward revision to Singapore's 2009 GDP forecast by the government, strong earnings forecast by Korea's largest steelmaker POSCO and an improvement in business conditions in Australia, also helped lift investor sentiment.
Meanwhile on Wall Street, positive analyst comments on the financial sector helped stocks surge higher on Monday with bank stocks leading the way. The major averages saw some further upside going into the close, ending the session at their best levels of the day. The Dow Jones Industrial Average closed up 2.27%, the Nasdaq Composite index moved up 2.12% and the S&P 500 index rose 2.49%.
In economic news, the U.S. federal deficit topped one trillion dollars for the first time ever, according to Treasury Department statistics released on Monday. The Department reported that the federal deficit in June totaled $94.3 billion, pushing the total in the current fiscal year to nearly $1.1 trillion..
Crude oil futures drifted lower on Monday, briefly touching their lowest level in almost two months, on concerns that a gloomy economic outlook could curb energy demand. After closing at $59.69 a barrel, down 20 cents in New York trading on Monday, the commodity is now trading firm at $60.18 in Asian trading amid a stock market rally.
In corporate news, Frankfurt Stock Exchange listed Software AG said it has plans to acquire software, solutions and services company IDS Scheer AG for a total of 482.4 million euros. In addition, the company said that the founders of of IDS have agreed to sell their stake.
Kosmos Energy announced that it has signed definitive documentation for $750 million project finance debt facilities, which would be secured by the shares of the company's subsidiary Kosmos Energy Ghana and its interest in the world-class Jubilee oil field offshore Ghana.
Alcatel-Lucent SA's labor unions requested a meeting with French President Nicolas Sarkozy to discuss planned job cuts and the company's future. Sarkozy will meet with Alcatel-Lucent Chief Executive Officer Ben Verwaayen on July 15.
Swiss engineering group Sulzer reported a 29 percent drop in first-half orders and does not expect a quick recovery in its key markets.
German automaker Daimler AG announced Monday the sale of 40% of its equity interest in Tesla Motors Inc. to its new major shareholder Aabar Investments PJSC of Abu Dhabi.
The European markets rose on Monday, led by banking and automotive stocks. The FTSEurofirst 300 index of pan-European blue chips closed 1.95% higher, while the narrower DJ Stoxx 50 index rose 2.02%. Around Europe, the U.K.'s FTSE 100 index rose 1.82%, France's CAC 40 index surged up 2.31% and Germany's DAX index climbed 3.19%.
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