LONDON, Dec 18 European shares were seen opening higher on Tuesday, boosted by signs that U.S. politicians were nearing a deal to avoid a "fiscal cliff" of looming spending cuts and tax rises that threaten the health of the world's biggest economy. The differences over how to resolve the fiscal cliff narrowed significantly on 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. At 0720 GMT, futures for the Euro STOXX 50 index and for Germany's DAX were up by 0.6 percent. Futures for France's CAC-40 rose 0.5 percent, pointing to fresh peaks for the cash index. "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 DAX reached a 2012 high of 7,627.14 points on Monday, while the CAC hit a 2012 high of 3,659.10 points on Dec. 13. McLaren Securities managing director Terry Torrison said investors were focused solely on the U.S. "fiscal cliff" situation at present, with most still expecting a deal to be reached eventually. "They'll go right down to the wire, and then they'll make sure that it gets through," said Torrison. "Going into the new year, the picture is OK. We've had a good run, but I think there's more to come from it. Equities is still the place to be to get returns," he added. 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. -------------------------------------------------------------------------------- MARKET SNAPSHOT AT 0718 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 EX-JP 0.03 % 0.19 EUR/USD 1.3166 0.02 % 0.0003 USD/JPY 83.90 0.02 % 0.0200 10-YR US TSY YLD 1.775 -- 0.00 10-YR BUND YLD 1.386 -- 0.00 SPOT GOLD $1,702.20 0.27 % $4.55 US CRUDE $87.78 0.67 % 0.58 > '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 for US fiscal cliff fix COMPANY NEWS: ASTRAZENECA /SKYEPHARMA : The healthcare companies struck a deal whereby SkyePharma agreed an $8 million settlement in a dispute with AstraZeneca. SkyePharma also said its full-year trading had been in line with the company's expectations. ROCHE Britain's healthcare cost-effectiveness watchdog said it may reject Roche Holding AG's rug Avastin for treating advanced ovarian cancer in combination with two standard chemotherapy drugs. DEUTSCHE BANK Deutsche Bank Co-Chief Executive Juergen Fitschen conceded on Monday that criticism of his bank's culture in the wake of the 2007-09 financial crisis was justified and he wanted to reform it. RENAULT French automaker Renault will sign on Wednesday an agreement to build its first factory in Algeria. TESCO Tesco Plc is moving closer to appointing a UK chief executive, which could come in the early months of next year, the Financial Times reported on Tuesday. TOTAL Saudi Aramco and France's Total will double the capital of their oil refinery joint venture at Jubail to 7.12 billion riyals ($1.90 billion) as part of the planned financing for the project. ACTELION Swiss biotechnology company Actelion said on Tuesday its drug for patients with severe to chronic plaque psoriasis met its primary endpoint in a mid-stage trial. AIR BERLIN Gulf carrier Etihad is buying a 70 percent stake in Air Berlin's frequent-flyer programme as the German airline seeks to cut costs and pay down debt. NORSK HYDRO Norwegian aluminium producer Norsk Hydro appointed Eivind Kallevik as its new chief financial officer after Jørgen C. Arentz Rostrup decided to leave the firm, Hydro said on Tuesday. PETROFAC The oil services company said it expected full-year net profit growth of at least 15 percent. PGS Seismic explorer PGS expects its profit to rise sharply in 2013 as oil companies rush to secure capacity and push ahead with offshore exploration, the firm said on Tuesday. SOLVAY Belgian chemicals and plastics group Solvay said on Tuesday it was reorganising its soda ash production, with increases to take into account of market growth in Latin America and capacity cuts in southern Europe.