European stocks rose and Wall Street was expected to open higher Wednesday after a batch of upbeat earnings reports and ahead of the latest economic update from the U.S. Federal Reserve.
The FTSE 100 index of leading British shares was up 41.40 points, or 0.8 percent, at 5,078.61 while Germany's DAX rose 59.88 points, or 1.1 percent, at 5,413.23. The CAC-40 in France was 52.26 points, or 1.5 percent, higher at 3,636.51.
Sentiment was buoyed by some forecast-busting earnings in Europe.
British retailer Marks & Spencer's shares rose nearly 6 percent after it reported better than expected first-half profits and a pickup in market share. Societe Generale shares rose 3 percent after France's second-largest bank reported a doubling in third-quarter profit on strong earnings in investment banking, and shares in German sportswear company Adidas spiked 4 percent after it voiced cautious optimism for the coming year despite a 30 percent fall in third-quarter profit.
Though the earnings helped provide some support in Europe's markets, investors are warning of volatile trading in the hours and days ahead amid a raft of economic news, particularly from the U.S. Stocks around the world have suffered one of their worst weeks since July amid concerns about the pace of the global economic recovery.
"Investors may well still be harboring some doubts; there are convincing arguments to suggest that equities remain broadly inflated beyond realistic earnings targets," said David Jones, chief market strategist at IG Index.
Wall Street was expected to open higher and recoup Tuesday's losses. Dow futures were up 59 points, or 0.6 percent, to 9,776 while the broader Standard & Poor's 500 futures rose 6.2 points, or 0.6 percent, to 1,047.90.
The latest jobs survey from the ADP payrolls firm came in largely as anticipated — U.S. private employers shed 203,000 jobs in August — and did little to alter expectations in the markets that Friday's official government payrolls data for October will show unemployment in the U.S. above 10 percent. The payrolls data often set the stock market tone for weeks.
