European stocks surge on Greek expectations

European shares rallied on Wednesday, mirroring gains in most of Asia, on prospects that Greek lawmakers will approve a radical budget action to avert default, while miners gained on rising metals prices. London's benchmark FTSE 100 index of top shares soared 1.15 percent to 5,833.22 points in late morning deals. Frankfurt's DAX 30 leapt 1.49 percent to 7,276.93 points and in Paris, the CAC 40 index advanced 1.42 percent to 3,906.70. The Stoxx 50 index of leading eurozone companies won 1.46 percent to 2,790.72 points. "With all eyes on Athens, traders have been riding the recent wave of confidence on the broad-based assumption that the austerity vote will be passed," said analyst Yusuf Heusen at financial spread-betting firm IG Index. "Quite what this actually means when there are clear signs that the population won't buy into the measures required remains to be seen, making this rally look awfully fragile. "With little else on the economic calendar, affairs in Greece really are dominating what is otherwise a relatively quiet market." In recent days and weeks, investors have been on edge over a potential Greek default that could shatter confidence and send fresh shockwaves across global financial markets. The Greek parliament is later expected to vote in favour of austerity measures that are demanded by international creditors in exchange for the EU/IMF money that the troubled eurozone member urgently needs to survive a debt crisis. However, at the same time, the unpopular measures sparked a second day of violence in Athens on Wednesday, with police again firing teargas on thousands of protesters. Elsewhere in Europe on Wednesday, mining company shares were boosted by rising prices for most metals. In London, Antofagasta soared 4.14 percent to 1,357 pence, Kazakhyms rallied 3.08 percent to 1,340 pence and Vedanta won 2.48 percent to 2,021 pence, while Arcelor Mittal jumped 3.43 percent to 33.48 euros in Paris. Engine-maker Rolls-Royce meanwhile added 1.55 percent to 622.5 pence after announcing a $1-billion order from Singapore Airlines. Wall Street had raced higher on Tuesday, with all three major indices leaping more than one percent on optimism over Greece, while Asian stocks mostly rose on Wednesday. Japanese shares also moved into in positive territory after figures showed post-quake industrial output had surged to its second highest level on record while exporters were boosted by a weaker yen. Tokyo jumped 1.54 percent and Seoul closed 1.53 percent higher, while Sydney rose 1.23 percent in value. However Shanghai focused instead on renewed fears that China's leaders may hike interest rates as they try to dampen soaring inflation. The market dropped 1.11 percent. The losses in China weighed on sentiment in Hong Kong, which pared earlier gains to close flat.