The French market is in positive territory on Tuesday, after the U.S. markets ended notably higher overnight. Sentiment was also influenced by the meeting of European leaders on May 23, which may come up with new measures to address the region's debt crisis.
Meanwhile, the Organization for Economic Co-operation and Development warned in its latest economic outlook report that the global economic recovery is fragile and could be derailed by the ongoing Eurozone debt crisis.
The Paris-based think-tank downgraded the outlook for the euro area economy. It now sees a 0.1 percent contraction in economic activity in 2012, compared to 0.2 percent growth projected in the November report.
Meanwhile, Spain's borrowing costs continued to climb higher in the latest debt auction as markets remain concerned over the economic prospects of the country.
The Euro Stoxx 50 index of eurozone bluechip stocks is adding 0.85 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is gaining 0.81 percent.
The CAC 40 index is climbing 0.90 percent.
STMicroelectronics is surging 6.2 percent, thus leading the gainers.
Accor is gaining 5.6 percent. The company agreed to sell its U.S. budget hotel chain Motel 6 to investment firm Blackstone Group LP for $1.9 billion.
Renault is climbing 4 percent and Peugeot is gaining 2 percent.
Credit Suisse raised Lafarge to "Neutral" from "Outperform." The stock is climbing 2 percent.
Societe Generale is advancing 1.4 percent. Credit Agricole and BNP Paribas are moderately higher.
Veolia Environnement is declining 6.3 percent. Vallourec is falling 2 percent and Carrefour is losing 1.5 percent.
Elsewhere in Europe, the German DAX is adding 0.74 percent and the UK's FTSE 100 is rising 1.01 percent. Switzerland's SMI is advancing 0.78 percent.
In economic news, U.K. annual inflation slowed more than expected in April and reached the lowest since February 2010, data from the Office for National Statistics showed. Consumer price inflation fell to 3 percent from 3.5 percent in March, slightly below the expected rate of 3.1 percent.
U.K. policymakers can consider further monetary easing as anemic nominal wage growth and broadly stable inflation expectations suggest weak underlying inflationary pressure, the International Monetary Fund said on Tuesday.
"Monetary stimulus can be provided via further quantitative easing (QE) and possibly cutting the policy rate," the lender said in its Article IV Consultation Concluding Statement.
Across to Asia, Fitch Ratings trimmed Japan's credit ratings, citing growing risks to credit profile as a result of high and increasing public debt ratios. The long-term foreign and local currency Issuer Default Ratings were lowered to 'A+' from 'AA' and 'AA-', respectively. The outlooks on both ratings are Negative.
The Conference Board's leading indicator for China's economic activity increased at a steady pace in April, suggesting a modest growth ahead. However, the underlying indicators showed some degree of weakness, sending a mixed message over the prospects of the economy.
Among major markets in Asia/Pacific, Australia's All Ordinaries gained 1.2 percent and Hong Kong's Hang Seng rose 0.6 percent. China's Shanghai Composite Index and Japan's Nikkei 225 added 1.1 percent each.
In the U.S., futures point to a lower open on Wall Street. In the previous session, the Dow rose 1.1 percent, the Nasdaq jumped 2.5 percent and the S&P 500 climbed 1.6 percent.
In the commodity space, crude is falling $0.44 to $92.13 per barrel and gold is losing $10.9 to $1577.8 a troy ounce.
by RTT Staff Writer
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