European stocks climb in muted trade

European stock markets rose Tuesday on low volumes, steadier oil prices and earlier gains in Asia, with many traders away for an extended festive break.

In Paris, the benchmark CAC 40 index rallied 1.3 percent and Frankfurt's DAX 30 climbed 1.5 percent. Both indices had reopened with slight losses on Monday after the Christmas holiday.

London returned to action on Tuesday with more modest gains but the homebuilding sector jumped on demand hopes in the wake of recent flooding in northern England.

The British capital's FTSE 100 index added 0.4 percent compared with the close of its last trading day on Thursday.

In foreign exchange deals, the European single currency firmed to $1.0977.
"Thin trading volumes appear to be enhancing whatever nascent positive sentiment there is in the eurozone, allowing the DAX and CAC to stretch out their legs," said analyst Connor Campbell at trading firm Spreadex.

"The FTSE has not been so lucky; despite a strong set of housing stocks due to the tragic flooding in the north of England, and a stable oil price, the UK index is struggling to match its eurozone peers, hampered by a grumpy mining sector."

In London, homebuilders Persimmon and Taylor Wimpey gained 1.98 percent and 2.03 percent, to stand at 2,012 pence and 201.2 pence respectively.

"With the cost of repairing and rebuilding the countless homes up north that have been damaged by the flooding ... investors appear to be confident that the housing sector is set to benefit," added Campbell.
Crude oil prices firmed on Tuesday but held near recent multi-year lows, dogged by stubborn oversupply and tepid economic data.

Asian equities broadly rose Tuesday in see-saw trading despite fears about the state of China's economy, a key driver of global growth. Thin trading volumes also underpinned gains as markets wind down for the final week of the year.

"Equity markets (in Europe) are in the green, tracking an Asian recovery of sorts, amid continued assurances from Beijing that it will continue to monitor the economy and administer treatment where required," said research analyst Augustin Eden at trading firm Accendo Markets.

Shanghai finished up 0.85 percent and Shenzhen added 0.95 percent. Hong Kong's Hang Seng index ended 0.36 percent higher.

In Tokyo, the Nikkei 225 added 0.58 percent on bargain-hunting. Seoul tacked on 0.11 percent, while Taiwan closed 0.77 percent lower. Singapore dipped 0.45 percent.

Earlier in the day, sentiment drooped in the wake of disappointing industrial profit data that pointed to weakness in China's economy.

The looming end to a six-month Chinese share sale ban aggravated worries about a sell-off on mainland bourses.

Dealers were also spooked by reports that Saudi Arabia would cut fuel and utility subsidies in response to a record budget deficit to cope with plunging oil prices.

- Key figures around 1100 GMT -

London - FTSE 100: UP 0.4 percent at 6,276 points from last Thursday's close.

Paris - CAC 40: UP 1.3 percent at 4,677 points from Monday

Frankfurt - DAX 30: UP 1.5 percent at 10,814

EURO STOXX 50: UP 1.4 percent at 3,301

Tokyo - Nikkei 225: UP 0.58 percent at 18,982.23 (close)

New York - Dow: DOWN 0.1 percent at 17,528.27 (close)

Euro/dollar: UP at $1.0977 from $1.0970 late Monday

Dollar/yen: UP to 120.44 yen from 120.38 yen