- Turkish central back meets
- UK GDP slows
- US consumer confidence rises
- Fed begins two-day policy meeting
FTSE 100: 0.33%
CAC 40: 0.98%
FTSE MIB: 0.91%
IBEX 35: 1.24%
Stoxx 600: 0.68%
European stocks advanced after Turkey's central bank tackled measures to address the falling lira and rising inflation.
Governor Erdem Casci said he would not hesitate to tighten monetary policy and raise interest rates if needed.
He denied concerns that the bank had avoided interest rate hikes due to pressure from the government after Prime Minister Tayyip Erdogan voiced his opposition against such a move.
Meanwhile, India's central bank unexpectedly raised interest rates in an effort to rein in high inflation. The Reserve Bank of India raised the benchmark repo rate, the amount at which it charges to lend to commercial banks, to 8% from 7.75%.
Some analysts fear the US Federal Reserve's decision last month to begin scaling back its monthly asset purchases by $10bn to $75bn may have hurt growth in developing countries amid a drop in emerging market currencies.
However, Capital Economics said today it doubts these concerns will sway the central bank in its decision on whether to introduce further tapering after its policy meeting tomorrow.
"[...] to the extent that monetary policy can alleviate the turmoil in emerging markets in particular, it is up to the central banks of those countries to respond, not the Fed," the analyst said.
Capital Economics expects the Fed to trim bond purchases by $10bn despite the recent market turbulence fuelling speculation that it will hold back.
UK economy grows in line
UK gross domestic product (GDP) expanded in line with expectations at a quarter-on-quarter rate of 0.7% in the last three months of the year, according to preliminary estimates from the Office for National Statistics (ONS).
It followed an 0.8% rise in the third quarter.
Howard Archer, Chief European+UK Economist at IHS Global Insight, said the modest slowdown reinforced his view that the Bank of England would not be raising rates in the coming year, despite a sharp fall in unemployment.
In the US, the Conference Board's closely-watched gauge of consumer confidence rose to 80.7 in January from a revised 77.5 in December, coming in ahead of the consensus forecast of 78.
Orders for US durable goods unexpectedly dropped by 4.3% in December to reach $229.3bn, according to the latest figures released by the Department of Commerce, mainly as a result of a fall in orders from volatile sectors such as defence and aircraft. While headline orders were 4.9% higher than December 2012, markets had been looking for a 1.8% increase month-on-month.
Miners rally on Nomura upgrade
BHP Billiton and Rio Tinto moved higher after Nomura Holdings Inc. raised its rating on the mining industry to 'neutral' from 'bearish'.
Afren increased as the oil and gas explorer said it expects total sales rose to $1.65bn in 2013 from $1.5bn in 2012, surpassing the consensus forecast of $1.62bn.
Software AG was up after the Germany company predicted that earnings before interest and taxes (EBIT) may increase by as much as 10% in 2014.
Swedbank declined as the Swedish lender said net income fell 15% to 3.61bn kronor due to rising costs, missing analysts' estimates.
Siemens gained after reporting quarterly net profit that beat estimates.
F&C Asset Management jumped after Bank of Montreal bought the owner of the UK's oldest investment fund for £708m.
Imagination Technologies Group, which supplies to Apple, dipped following news Apple sold 3.7m fewer iPhones than analysts had predicted for the three months ended December 28th.
The euro was down 0.10% to $1.3660.
Brent crude futures rose $0.568 to $107.300 per barrel, according to the ICE.