EUROPE MARKETS: European Stocks Lean Toward Record Close

By Sara Sjolin, MarketWatch

LONDON (MarketWatch) -- European stock markets pushed toward their highest close in six years on Tuesday after the People's Bank of China provided a short-term liquidity injection to commercial banks.

The Stoxx Europe 600 index rose 0.4% to 337.12, tracking Wall Street and most Asian bourses higher.

Shares of Unilever PLC (UL) gained 2.5% after the consumer-products company reported a rise in full-year earnings.

Shares of Novozymes AS (NVZMY) picked up 1.9% after the enzyme maker said it expects sales and profits to rise in 2014 from the previous year. It also posted a slightly stronger-than-expected profit increase for the fourth quarter and proposed a raised dividend for 2013.

On a more downbeat note, shares of Alstom SA tumbled 14%, making the company the worst performer on the Stoxx 600. The Alstom said demand for its turbines has dropped off because global utilities are building fewer power plants and cut its operating margin forecast for the full year.

Shares of Rémy Cointreau SA rebounded from earlier losses, rising 1.6%. The drinks maker said it doesn't expect sales to rebound in China during the crucial Lunar New Year holidays later in the month. The country's crackdown on official gift-making pushed sales down more than 20% in the latest quarter.

More broadly, the coming Chinese holiday was in focus in the financial sector. Most Asian markets closed in positive territory on Tuesday after the People's Bank of China said it would intervene in the money markets to cool the "squeeze in interbank-lending lending/borrowing rates, which had moved up in repose to the seasonal New Year cash drawdown by the public," according to Mike van Dulken, head of research at Accendo Markets. Around the holiday, large amounts of money are usually withdrawn from the banks to fund travel and gifts.

In Europe, the ZEW sentiment survey showed German economic expectations unexpectedly fell in January, although they remained at a high level.

Germany's DAX 30 index rose 0.6% to 9,772.10. France's CAC 40 index added 0.4% to 4,337.74, and the U.K.'s FTSE 100 index gained 0.2% to 6,851.49.

BNP Paribas SA climbed 2.8% in Paris after J.P. Morgan Cazenove lifted the French bank to overweight from neutral on expectations of "higher capital return and a sensible external strategy to unlock value."

Outside the main indexes, shares of Nordea Bank AB (NRBAY) lost 1.3% after Credit Suisse cut the bank to neutral from outperform. The analysts said the stock had reached the fair-value level.

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