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Stocks to Open Higher; Optimism on Euro Crisis Prevails

European stocks were expected to open higher on Monday after closing the week higher on Friday, marking a third consecutive week of gains.

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The FTSE is called 47 points higher, the DAX in Frankfurt is expected to open up by 40 points and the CAC 40 is predicted to be higher by 26 points.

Better-than-expected earnings news from a number of European firms on Friday saw shares rise, while positive US retail data also buoyed investor sentiment ahead of the close. Tech stocks performed particularly well, rising by 2.1 percent following positive earnings results from German software firm SAP .

In Asia overnight, shares followed gains seen in Europe and on Wall Street on Friday as investors remained optimistic that a crucial EU summit this week will go some way to solving the sovereign debt crisis within the euro zone.

German Finance Minister Wolfgang Schaeuble warned on Sunday that the Greek debt writedown must be larger than July's agreed deal of 21 percent and euro zone policymakers will attempt to convince banks to accept a new deal.

Spanish daily newspapers El Mundo reported Sunday that a new European bank stress test could apply haircuts of up to 20 percent on Spanish government debt in an effort to recapitalize the nation's struggling banks. The newspaper, citing unnamed sources said the haircut would see losses of around 46 billion euros ($63.7 billion) for Spanish banks with large holdings of sovereign debt.

Some welcome news for investors appears in Monday's edition of UK paper The Guardian, which reports that the EU plans to launch a 50 billion euro ($69 billion) infrastructure program, creating hundreds of thousands of jobs in the process.

Corporate releases out on Monday include Dutch electronics firms Philips third-quarter earnings which reported earnings before tax of 273 million euros, falling short of a Reuters forecast of 334 million euros.

Swiss-based transportation and logistics company Kuehne + Nagel will announce their third-quarter results at 6:45 UK time. Societe Generale's Matthew O'Keefe has predicted the company's net profit could be down by as much at 8.3 percent and the company's CFO will be on Squawk Box at 7:45.

In Greece, finance ministry officials including tax inspectors will begin a nine - day strike against austerity measures imposed by the government, while in London protests will continue in the City as part of a series of global protests against big business and banking.

In Portugal, Monday is the deadline for the delivery of the nation's 2012 budget which Prime Minister Passos Coelho has conceded will be the most difficult to enact in living memory. Portuguese newspaper Jornal de Negocios reported that the government expects the economy to shrink by at much as 3 percent next year.

Economic data out on Friday includes the Bundesbank monthly bulletin at 11:00.