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Europe stocks close higher on Fed stimulus hopes

European market closes higher

European shares closed higher on Tuesday following the latest U.S. labor report, whose disappointing numbers encouraged investors' hopes that the will delay off its monthly asset purchases.

European Markets: FTSE, GDAXI, FCHI, IBEX

US jobs data, at last

The hit a fresh five-year high in afternoon trade and provisionally closed up 0.5 percent at 1,287.32 points, following the U.S. jobs report, which had been delayed by a few weeks due to the partial government shutdown. The FTSE 100 and Germany's closed up 0.6 and 0.9 percent respectively.

U.S. employers added 148,000 workers in September, according to the Labor Department, with the unemployment rate dropping from 7.3 to 7.2 percent, its lowest level since November 2008.

Analysts polled by Reuters had estimated that 180,000 new jobs were created last month. However, this disappointment boosted expectations that the Federal Reserve would keep monetary policy ultra-loose for longer.

The news boosted U.S. stocks, but they eased subsequently, dragged by weakness in technology.

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Stocks news

Back in Europe, the basic resources sector was higher after BHP Billiton released earnings. The miner upgraded its full-year iron ore production target and posted record quarterly oil output. Shares closed higher by 4.29 percent.

Shares of Swedbank closed up 3.56 percent after the Swedish lender reported a strong third quarter, with a boost in lending income.

Telecommunications and ICT service provider KPN posted a third-quarter fall in net profit of 13 percent, but analysts said this was better-than-expected; shares closed up 0.58 percent.

In other stocks news, shares in U.K. supermarket Tesco closed slightly lower by 0.20 percent, after a report that Warren Buffett's Berkshire Hathaway had slashed its stake in the world's No.3 retailer by about 20 percent.

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'Repurcussions' from Bill Gates' stake in FCC

Shares of Novartis rose by 1.99 percent after the drugs company reported third-quarter earnings that were inline with expectations.

U.K. company ARM Holdings - which designs semiconductors that are then built under license for device makers such as Apple - beat expectations Tuesday but analysts were wary on its outlook. The stock closed lower by 3.36 percent.

(Read More: ARM chief dismisses talk of smartphone saturation)

Shares of Spanish construction company FCC surged 8.3 percent after the company announced Bill Gates had become its second largest shareholder with a 6 percent stake.

Nokia unveils six new products

Consumer goods group Reckitt Benckiser announced that it is reviewing options for its pharmaceuticals unit, effectively putting up for sale its prescription medicine for heroin addiction. Shares in the British company closed up 5.2 percent.

(Read more: Reckitt Benckiser could sell pharma unit)

Activist investor Daniel Loeb's Third Point said it took a stake in Nokia late in the third quarter. Nokia shares closed up 0.09 percent after the news.