US, China economic figures shore up markets

LONDON -- Upbeat signs from the world's two largest economies propped up markets Monday, at the start of a week that could offer greater clarity on the economic fates of Greece and Spain.

Markets started ticking higher when China said its inflation rate fell to 1.9 percent in September, from 2 percent the month before, and exports were up 9.9 percent.

The figures eased concerns that the world's second-largest economy was poised for a hard landing and suggested that the country's monetary authorities have room to ease monetary policy.

In Europe, Germany's DAX closed up 0.4 percent at 7,261 while the CAC-40 in France rose 0.9 percent to 3,420. The FTSE 100 index of leading British shares was 0.2 percent higher at 5,805.

"Sentiment is generally positive, boosting equities, after some better-than-expected data from China," said Benjamin Reitzes, an analyst at BMO Capital Markets.

In the U.S., the world's largest economy, figures showed retail sales rose by a stronger than expected 1.1 percent in September, on top of a 1.2 percent gain in August, reinforcing the view that the economic recovery is picking up pace.

"This report supports the view that the Q2 slowdown in consumer spending was temporary, and that the Q3 rebound was stronger than expected," said Michael Woolfolk, an analyst at BNY Mellon.

In the U.S., the Dow Jones industrial average was up 0.6 percent to 13,325 while the broader S&P 500 index rose 0.48 percent to 1,435.

Citigroup Inc. was doing particularly well, trading 3 percent higher after beating Wall Street earnings estimates. The bank made $1.06 per share from July through September after excluding special items, head of predictions of 96 cents.

Investors remained cautious, however, ahead of more corporate earnings reports and a key summit of EU leaders on Thursday and Friday, where Greece and Spain are likely to share the spotlight.

Investors want clarity over whether the Greek government's latest package of spending cuts has convinced debt inspectors to approve the payout of the country's next batch of bailout cash. They also want an end to the uncertainty over whether Spain will tap a new bond-buying facility from the European Central Bank.

James Hughes, chief market analyst at Alpari, said the summit in Brussels "could be a turning point for the eurozone."

In the currency markets, the euro continued to find support despite the debt-related headwinds, trading only 0.1 percent lower at $1.2943.

Softbank Corp. confirmed after the Asian market close that it has reached a deal to buy 70 percent of U.S. wireless carrier Sprint Nextel Corp. for $20.1 billion. The deal has prompted some excitement as it will be the largest ever foreign acquisition by a Japanese company.

Japan's Nikkei 225 index rose 0.5 percent to close at 8,577.93, snapping a four-day losing streak. Hong Kong's Hang Seng rose less than 0.1 percent to 21,148.25. South Korea's Kospi fell 0.4 percent to 1,925.59.

However, mainland China's Shanghai Composite Index lost 0.3 percent to 2,098.70 and the smaller Shenzhen Composite Index lost 0.7 percent at 859.47.

Oil prices gave up some recent gains, with the benchmark oil contract for November delivery down $1.25 cents to $90.58 per barrel in electronic trading on the New York Mercantile Exchange.