US Markets

U.S. stocks trimmed early gains Tuesday as investors weighed worries about Europe's debt crisis with an unexpected increase in consumer confidence. The Dow Jones Industrial Average gained 26 points, or 0.2%, to 11549 after earlier rising as much as 101 points. Home Depot jumped 4%, while Coca-Cola rose 2.3% to lead the Dow advancers.

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The Standard & Poor's 500-stock index added 1 point, or 0.1%, to 1194, as energy and consumer-staple stocks rose. The technology-oriented Nasdaq Composite declined 18 points, or 0.7%, to 2509. With the afternoon downturn, market breadth has turned negative. On the New York Stock Exchange there are 17 declining stocks for every 13 gainers.

For the Nasdaq, the ratio is 2 to 1 in favor of falling stocks.The market initially got a boost after a report showed consumer confidence jumped to its highest level since July.

The Conference Board, a private research group, said its index of consumer confidence jumped to 56.0 in November, from a revised 40.9 in October. The November index was far better than the 45.0 economists expected. On the corporate front, AMR, the parent company of American Airlines, filed for Chapter 11 bankruptcy protection. AMR plunged 78%. Tiffany slumped 8.7% after better-than-expected third-quarter results were overshadowed by the high-end jewelry retailer's disappointing earnings outlook for this quarter.

European Markets

European stocks ended a bumpy session in the black Tuesday, underpinned by stronger than expected U.S. consumer-confidence data, a well-received Italian bond auction and hope that euro-zone policy makers will make progress in tackling the region's debt crisis. The Stoxx Europe 600 index closed up 0.8% at 231.68. The U.K.'s FTSE 100 index rose 0.5% to 5337.00, France's CAC-40 index ended up 0.5% at 3026.76 and Germany's DAX added 1% to 5799.91.

Stocks started the day off on the back foot, but sentiment received a boost after Italy managed to sell EUR7.499 billion in bonds, near the top of its EUR8 billion target range. Investors welcomed the decent demand, despite surging borrowing costs. Italy paid a yield of 7.89% on three-year bonds and 7.56% on the 10-year paper both of which marked euro-era highs. There was also some good news on the corporate front. German chemicals company BASF gained 2.1% after raising its 2020 sales guidance, helping the Stoxx Europe 600 chemicals index to close 1% higher.

In France, Remy Cointreau gained nearly 3%. The company reported first-half net income tripled and adjusted profit rose 22%, as sales rose 11%. Meanwhile, banks managed to bounce off lows reached early in the session after Moody's Investors Service said it may downgrade the subordinated debt of 87 European banks, to end higher.

The Stoxx Europe 600 banks index closed up 0.1%. French banks underperformed the wider sector, following a report in French newspaper La Tribune saying France's coveted triple-A credit rating might soon be put on review for a potential downgrade by Standard & Poor's Ratings Service. Still, Societe Generale and BNP Paribas ended off lows, down 0.4% and 1.2%, respectively. Despite the positive tone, markets were choppy Tuesday and traders cautioned that in terms of the fundamentals, nothing has changed.

Indeed, worries about growth prospects were never far from investors' minds. UBS downgraded its gross-domestic-product forecast for the euro area in 2012 to a 0.7% contraction, from a previous estimate of 0.2% growth, saying the recession will likely start in the fourth quarter of this year, rather than the first quarter of next year. U.K. growth was also in focus Tuesday, after Chancellor George Osborne downgraded forecasts in his autumn statement. The forecast for 2011 was cut to 0.9% from 1.7%, while the 2012 growth forecast was lowered to 0.7% from 2.5%.

Investors were also awaiting the outcome of a two-day meeting of euro-zone finance ministers in Brussels. Ministers are expected to finalize the changes to the European Financial Stability Facility and decide on the next tranche of aid to Greece. However, such meetings have failed to live up to expectations in the past, so the scope for disappointment is high.

Asian Markets

Asian shares ended mostly higher Tuesday after the U.S. holiday-shopping season got off to a strong start and on optimism European officials are moving toward closer fiscal union to resolve the Continent's debt crisis as a meeting of euro-zone finance ministers was set to begin. Hong Kong's Hang Seng Index and the Shanghai Composite Index each gained 1.2%, to 18256.20 and 2412.39, respective, while Japan's Nikkei Stock Average and South Korea's Kospi each rose 2.3%, to 8477.82 and 1856.52, respectively.

Bucking the trend, India's Sensex lost 1% to 16008.34 as the government failed to break the political deadlock over the government's plan to open the retail sector to foreign investment. Around the region, major exporters, which rely heavily on end-of-year sales in the world's biggest economy, rose after the solid start to the shopping season.

Samsung Electronics advanced 2.8% and LG Electronics gained 4.2% in Seoul, while Acer tacked on 2.1% in Taipei and sourcing company Li & Fung rose 1.8% in Hong Kong. In Tokyo, Hitachi jumped 5.5% and Sony added 2.1%. Financial stocks also advanced after their U.S. counterparts posted gains on hopes for fresh measures to stem the euro-zone debt crisis. HSBC gained 2.7% in Hong Kong, Shinhan Financial was up 1.7% in Seoul and Mitsubishi UFJ Financial was 1.5% higher in Tokyo. Retail plays dropped sharply in India as the deadlock over foreign investment in the sector continued. Pantaloon Retail fell 12%, Koutons Retail lost 7.3% and Shoppers Stop dropped 2.8%.

Commodities

Base metals closed mostly lower on the London Metal Exchange Tuesday, although losses were kept in check by the supportive presence of a stronger euro and better than expected U.S. consumer confidence data. At the close, flagship three-month copper was 0.1% lower on the day at $7,485 a metric ton.

Aluminum was 1.5% lower at $1,995/ton. Although profit taking saw copper slip from the 10-day high $7,535/ton hit the previous session, a stronger eurodollar which makes dollar-denominated assets appear cheaper and encouraging economic data from the world's largest economy kept losses to a minimum, according to analysts and traders.

Crude futures broke above $100 a barrel midday Tuesday for the second day in a row amid escalating tensions in Iran. Students stormed into the British Embassy in Tehran Tuesday, marking the latest political action in oil producing regions that have kept energy traders on edge. With European Union officials due to meet Thursday to discuss an E.U.-wide ban on imports of Iranian oil, investors are preparing should the move lead to supply shortfalls.

Light, sweet crude for January delivery settled $1.58 higher at $99.79 a barrel on the New York Mercantile Exchange. Gold futures carved out a small gain, following the euro higher as currency trading continued to dominate price direction in the precious metals market. The most actively traded contract, for December delivery, rose $2.60, or 0.2%, to settle at $1,713.40 a troy ounce on the Comex division of the New York Mercantile Exchange.