European equities have pushed higher for the most part after the German IFO business climate index for January came in at 104.2 while analysts expected 103.

Similarly, the current conditions index came in at 108 points, topping estimates of 107.2.

"In manufacturing the business climate indicator continued to rise. Manufacturers are more satisfied with their current business situation than last month. The improvement in expectations with regard to future business developments continued into the New Year. Optimism is returning. After three successive declines, capacity utilisation rates also rose," said IFO Institute President Hans-Werner Sinn.

The IFO survey results were just one of the main macro-economic references that investors were anxious to see. There are other market-driving events that must be accounted for, including fourth quarter economic growth in the UK which missed expectations Friday morning. Some traders there may still be spooked by all the talk of a European Union membership referendum.

Some analysts fear a triple-dip recession in the UK. Speaking from Davos, Finance Minister George Osborne restated his intention of staying firm on austerity in spite of criticism by the International Monetary Fund.

The other data that was due Friday and highlighted in most calendars is US new home sales. 385,000 homes are expected to have been sold in December compared to 377,000 in the previous month.

Not to forget, any European Central Bank announcement of long term refinancing operation (LTRO) repayments. Some are concerned about the effect this will have on short-term interest rates, particularly the sovereign debt market, and of course the euro.

JP

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