European and U.S. stock markets rose Monday amid mounting hopes that third-quarter earnings results will provide more evidence the world economy is enjoying a solid recovery.
Strong profits from Royal Philips Electronics NV, published earlier Monday, helped fuel those hopes.
In Europe, Germany's DAX closed 71.35 points, or 1.3 percent, at 5,783.23 while France's CAC-40 was 46.19 points, or 1.2 percent, higher at 3,845.80
Meanwhile, the FTSE 100 of leading British shares rose to its highest level for over a year, closing up 48.30 points, or 1 percent, at 5,210.17 _ that's the first time it has closed above the 5,200 barrier since September last year.
"The next FTSE target traders are eyeing in the short term is the 5,350 high hit in September last year and the way sentiment is going it would not be a surprise to see that hit this week," said David Jones, chief market strategist at IG Index.
On Wall Street, stocks rose, though trading was relatively subdued as much of the country celebrates Columbus Day federal holiday. The Dow Jones industrial average was up 54.11 points, or 0.6 percent, 9,919.05 around midday New York time while the broader Standard & Poor's 500 index rose 7.48 points, or 0.7 percent, to 1,078.97.
If the Dow closes above Friday's 9,864.94, then that would be the new highest level since October 6 last year.
Investor sentiment was buoyed Monday by the news that Philips, Europe's biggest consumer electronics company, made a net profit of ⁈llion ($256 million) in the third quarter _ three times last year's comparable figure _ and said it was seeing quarterly improvements in earnings and sales.
That stoked market hopes that businesses around the world have weathered the worst of the economic storm and are poised to take advantage of the global recovery. Philips shares rose around 6 percent.
Philips' better than expected results came as investor attention is firmly focused on the third-quarter results season. Most interest this week will be on major U.S. financial institutions such as Citigroup Inc., Bank of America Corp, Goldman Sachs Group Inc. and JP Morgan Chase & Co.
"Although the gradual stabilization in the global economic outlook helped equity markets stage a robust upswing since the turnaround in late Q1, questions remain about the sustainability of the recovery and uncertainty in the market is still high," said Silvio Peruzzo, an analyst at Royal Bank of Scotland.
The financial sector, which led the market down at the outset of the crisis, generally outperformed other sectors, leading the market on the way up wwsince March's lows.
In particular, investors will be looking to see how much companies have been able to drive up earnings by generating revenues as opposed to cost-cutting measures.
"Strong corporate results for Q3 would contribute significantly to the process of market normalization, increasing risk tolerance further and supporting market confidence," said Peruzzo.
Earlier, before the optimism about upcoming earnings took root in Europe, Asian markets closed mostly lower.
Hong Kong's Hang Seng closed down 200.09 points, or 0.9 percent, at 21,299.35 and South Korea's Kospi dropped 0.4 percent to 1,639.81. Australia's benchmark index fell 0.3 percent, while China's Shanghai index slipped 0.6 percent at 2,894.48.
Japan's stock market was closed for a holiday.
Elsewhere, Singapore's index was up 0.9 percent after the government narrowed its forecast for economic contraction this year and said the economy grew for the second straight quarter in the July to September period.
Oil prices rose amid the mounting optimism. Benchmark crude for November delivery climbed $1.59 to $73.36 a barrel.
The dollar, which has been on the retreat over recent weeks, was steady at 89.72 yen while the euro rose 0.4 percent to $1.4788.
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AP Business Writer Jeremiah Marquez in Hong Kong contributed to this report.
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