US markets

The Dow Jones Industrial Average recaptured the 12000 level Tuesday, buoyed by bellwether earnings and encouraging manufacturing data, as traders looked past the unease rippling through the Middle East. On the first day of February trading, the Dow rose 135 points, or 1.1%, to 12027. Extending Monday's gains, the blue-chip measure regained the level where it had been trading before Friday's selloff that came on the political turmoil in Egypt. The Dow hasn't closed above 12000 since June 19, 2008.

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Boosting the measure, Pfizer rose 5.3%, after the drug company's fourth quarter profit more than tripled from a year earlier, though the company gave a cautious outlook for the coming two years. Pfizer also said it would significantly reduce research spending and shift billions of dollars to buying back stock. The Nasdaq Composite surged 1.9% to 2752. The Standard & Poor's 500-stock index climbed 1.6% to 1306, as materials gained. Earnings and brightening manufacturing data captured the spotlight Tuesday, overshadowing the turmoil in the Middle East, even as protests and signs of change spread to Jordan and Yemen. Investors said the army's refusal to use force against the massive crowds eased some investors' anxieties. Powering Tuesday's triple-digit climb, the Institute for Supply Management's index of manufacturing activity rose to 60.8 in January, its highest level since May 2004, topping economists' expectations. The key manufacturing data overshadowed an unexpected 2.5% drop in construction spending in December. In corporate news, United Parcel Services, a package delivery company seen as a bellwether for the economy, climbed 4.6% after its fourth quarter profit jumped 48% as revenue and margins surged and the company forecast record full year earnings. Automakers also rose as January sales showed improvement. General Motors added 0.7% after its auto sales grew 22% in January. Ford gained 0.8% after its U.S. vehicle sales jumped 13% in January.

European markets

European stock markets rallied Tuesday, buoyed by strong earnings reports from technology firms and upbeat economic data from the euro zone and the U.S. The Stoxx Europe 600 index rose 1.5% to end at 284.20. The index extended gains after the release of stronger than expected U.S. manufacturing data from the Institute for Supply Management. European markets were boosted early on by solid regional economic reports. The euro-zone unemployment rate remained at 10% in December, data showed. Economists had expected it to rise to 10.1%.

A separate survey indicated that January euro-zone manufacturing activity accelerated at its fastest pace in nine months. In Germany, Infineon Technologies AG rose 1.3% after the chip maker said its quarterly profit more than tripled and raised its outlook for revenue growth. The gain contributed to a 1.5% rise for the DAX 30 index to 7,184.27. Oil and gas stocks were higher across Europe. Total SA surged 3.2% and Royal Dutch Shell PLC climbed 3%. BP PLC gained 1.3% after the oil giant reported a surge in fourth quarter net profit and said it will resume paying dividends. Mining stocks rallied, with Kazakhmys PLC advancing 4.8% and Fresnillo PLC soaring nearly 7%. The gains helped lift the U.K.'s FTSE 100 index, which ended up 1.6% to 5,957.82. The French CAC 40 rose 1.7% to 4,072.62, as cement producer Lafarge SA rallied nearly 4%.

Asian markets

Asian stock markets were mostly higher Tuesday, with choppy trading in China ahead of this week's Lunar New Year holiday and after data painted a mixed picture of its manufacturing sector. China's official PMI, published by the National Bureau of Statistics and the China Federation of Logistics and Purchasing, fell to 52.9 in January from 53.9 in December. But a competing PMI put out by HSBC Holdings PLC showed a modest rise to 54.5 from 54.4 in December, suggesting that further policy tightening from Beijing remains in the cards. Hong Kong's Hang Seng Index gained 0.2%, China's Shanghai Composite rose 0.3%, Japan's Nikkei Stock Average ended up 0.4% and South Korea's Kospi Composite was up 0.1% as sentiment got a boost from the Dow's showing Monday. The Shanghai market was supported by gains in resources and energy stocks after commodity prices surged Monday. Aluminum Corp. of China Ltd, or Chalco, was up 2.8% and Industrial & Commercial Bank of China rose 0.2%. In Tokyo, Japanese stocks were supported by solid corporate earnings and the euro's recent gains against the yen. Honda Motor Co. was up 1% after it raised its fiscal year net profit forecast. Inpex Corp. rose 2.3%, helped by Monday's jump in crude-oil prices.

Base metals

Base metals closed higher on the London Metal Exchange Tuesday as the markets were boosted by a combination of positive catalysts, including a stronger euro. LME three month copper closed at $9,945 a metric ton, after having rallied as high as $9,957/ton a new record as short position holders bailed out of the market. Copper's push higher came as the euro advanced to its highest level against the dollar since mid-November, spurred by expectations of increased euro-zone interest rates. Crude oil futures finished Tuesday with a 1.5% loss after reports that Egyptian President Hosni Mubarak won't run for re-election helped ease concerns over the potential for oil supply disruptions in the Middle East. Light, sweet crude on the New York Mercantile Exchange settled $1.42 lower at $90.77 a barrel. Europe's benchmark crude oil contract had passed $102 a barrel Tuesday, hitting a fresh two year high. Copper futures closed at a record high, rallying as investors bet on stronger demand for the industrial metal after a gauge of U.S. manufacturing activity rose to its highest in nearly seven years. Gold futures climbed as a drop in the U.S. dollar to its lowest level since November made the precious metal more attractive to investors. Copper for March delivery rose 9 cents, or 2%, to end at $4.547 a pound on the Comex division of the New York Mercantile Exchange. Gold for April delivery closed up $5.80 at $1,340.30 an ounce on Comex.