By Ishaq Siddiqi
Stocks rallied as investors welcomed the prospect of more action by the Federal Reserve to prod the U.S. economy and as euro-zone industrial production rebounded faster than expected.
Germany's DAX index reached a 2010 high, while gold soared to another record, oil prices gained and the euro rose against the dollar.
Positive news about third-quarter earnings at U.S. companies reinforced the positive tone in the market. Intel /zigman2/quotes/203649727/composite INTC -2.79% made positive comments about its performance in the current quarter on Tuesday, and J.P. Morgan Chase /zigman2/quotes/205971034/composite JPM +0.97% reported a strong quarterly result on Wednesday.
The Stoxx Europe 600 index added 1.4% to 266.25. The U.K.'s FTSE 100 closed up 1.5% at 5747.35, Germany's DAX added 2.1% to 6434.52 and France's CAC-40 closed up 2.1% at 3828.34.
The earnings news, combined with a jump in Chinese demand for commodities, helped U.S. stocks to achieve a fourth straight day of gains. The Dow Jones Industrial Average added 75.68 points, or 0.7%, to 11096.08.
U.S. Treasury debt fell broadly, with the yield on the benchmark 10-year note rising to 2.431%. The fall in prices came as a $21 billion auction of Treasurys generated the lowest yield since January 2009, at 2.475%.
European energy and resource stocks jumped after China's trade surplus fell to a five-month low of $16.88 billion in September, largely due to a surge in imports of commodities, especially oil.
Also, euro-zone industrial production increased by 1% in August. The outcome would have been stronger if not for a 13.6% drop in Irish production.
Late in New York, the euro was at 1.3959, up from $1.3916 late Tuesday. The euro also rose against Japan's currency, trading at 114.13 yen from 113.91 yen, while the dollar was lower, at 81.78 yen from 81.85 yen. The U.K. pound was at $1.5890 from $1.5800 and the dollar was at 0.9605 Swiss francs from 0.9569.
In Asia, the Japanese market benefited from a surprise increase in orders for machinery, while the Chinese market was hurt by the September trade data.
Gold futures resumed their climb on the Comex division of the New York Mercantile Exchange. Gold for October delivery jumped $23.80, or 1.8%, to $1,369.50 an ounce. Light, sweet crude for November rose 1.6% to $83.01 a barrel on the New York Mercantile Exchange.
On Thursday, market participants will watch for reports on initial claims for U.S. unemployment benefits, producer prices and the balance of trade.
In major market action: Natural-resources shares gained after the Chinese trade figures reinforced expectatios for robust Chinese demand. In London, Vedanta Resources climbed 5.9%, Anglo American jumped 5.4% and Xstrata added 4.4%.
Fresnillo /zigman2/quotes/201300065/delayed UK:FRES +1.01% rose 3.3% after the firm reported an increase in third-quarter silver production.
Petrofac /zigman2/quotes/202340229/delayed UK:PFC +6.57% rose 4.2% after an upgrade to "overweight" from "equalweight" at Morgan Stanley, which said the company's order backlog looked set to accelerate.
While banks posted broad gains, Standard Chartered /zigman2/quotes/200125072/delayed UK:STAN +0.93% fell 1.7% after saying it will raise around £3.26 billion ($5.15 billion) in a rights issue.