European Factors to Watch - Shares seen up on 'fiscal cliff' progress

Tue Dec 18, 2012 1:26am EST

LONDON, Dec 18 (Reuters) - European shares were seen opening higher on
Tuesday, with traders citing signs that U.S. politicians are nearer a deal to
avoid a "fiscal cliff" of looming spending cuts and tax rises that could hit the
economy as the main reason for the expected rise.
    Financial spreadbetters expected Britain's FTSE 100 to open up by 18
to 19 points, or as much as 0.3 percent higher, while Germany's DAX was
seen rising by 20 to 24 points, or as much as 0.3 percent higher as well.
    France's CAC 40 was seen opening up by 16 to 19 points, or as much
as 0.5 percent higher.
    "It's hard to be too bearish today when we are likely to see new highs in
the DAX and the CAC," IG Markets' chief market strategist Chris Weston wrote in
a note.
    The differences over how to resolve the fiscal cliff narrowed significantly
Monday night as President Barack Obama made a counter-offer to Republicans that
included a major change in position on tax hikes for the wealthy, according to a
source familiar with the talks. 
    The latest signs of progress in those U.S. budget talks pushed the S&P 500
to end at its highest level in almost two months on Monday. 
    The Bank of Japan was also set to ease monetary policy this week and
consider adopting a 2 percent inflation target no later than in January, sources
said, responding to pressure from next Prime Minister Shinzo Abe for stronger
efforts to beat deflation.    
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 MARKET SNAPSHOT AT 0617 GMT                        
                                   LAST    PCT CHG  NET CHG
 S&P 500                       1,430.36     1.19 %    16.78
 NIKKEI                        9,923.01     0.96 %    94.13
 MSCI ASIA       <.MIASJ0000P               0.09 %     0.51
 EX-JP           S>                                 
 EUR/USD                         1.3174     0.08 %   0.0011
 USD/JPY                          84.03     0.18 %   0.1500
 10-YR US TSY                     1.786         --     0.01
 YLD                                                
 10-YR BUND YLD                   1.386         --     0.02
 SPOT GOLD                     $1,701.8     0.25 %    $4.16
 US CRUDE                        $87.74     0.62 %     0.54
 
  
  > GLOBAL MARKETS-'Fiscal cliff' hopes lift Asian shares, other risk assets
 
  > US STOCKS-Optimism about 'cliff' boost market; financials lead 
  > Nikkei hits 8-1/2-month high on LDP win, but utilities fall 
  > TREASURIES-Prices fall as hopes for fiscal deal dims safety bid 
  > FOREX-Yen edges lower, hovers near 20-month low vs dollar 
  > PRECIOUS-Gold struggles to break $1,700/oz, US fiscal talks eyed 
  > METALS-Copper inches up on U.S. fiscal cliff hopes, ETF approval 
  > Brent rises above $108 on hopes US will resolve budget crisis