European markets almost gain 1 per cent on strong China data

Joshua Raymond, Market Strategist at City Index commented: "European markets have continued on the front foot this week with investors shrugging off last weeks disappointing jobs data to buy into equities after data from China indicated that the global recovery may be gaining traction.

The data from China, which showed that exports have jumped by more than four times the amount estimated, has really boosted the market and is the main driver behind today's gains. If anything, the data and market reaction emphasises just how important a role China will play in the world's economic recovery.

Tonight marks the unofficial start of the fourth quarter US earnings season with Alcoa announcing after the closing bell and undoubtedly investors are looking for companies to deliver greater visibility on outlooks for 2010.

Investors want to see how quickly the economic recovery will grow and having seen a very cautious outlook for 2010 by some UK retailers last week, 2010 guidance is likely to be a sensitive issue for this earnings season.

Treading Water

Aside from the China data and some broker upgrades, there seems little else to be moving equities today and a number of investors may just be treading water to see if Alcoa sets the tone for the fourth quarter earnings season tonight.

Energy and Miners lead on China data

We have seen big demand for energy and mining stocks this morning purely on the back of data out of China. The data showed that crude imports had hit a monthly record and copper imports had also well beaten previous targets. Therefore, oil and mining firms have been particularly busy this morning, with both sectors rising over 2% in London trading and Cairn Energy leading the way higher."