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Global stocks mostly up as London hits record

New York - World stock markets mostly rose on Tuesday in the first session of 2017, with London reaching a new high and the Dow resuming its push towards the 20 000 milestone.

Those gains came after the release of generally upbeat economic data in the US and European countries, part of the ramp-up in economic news after the sleepy holiday period.

"Overall we ended 2016 with a great deal of optimism about stocks, even though the last week of the year was somewhat on a sideways move," said David Levy, portfolio manager at Republic Wealth Advisors.

The FTSE rallied after a survey showed UK manufacturing hitting a 30-month high in December.

The Institute for Supply Management gave a similar reading on the US, where manufacturing activity rose for the fourth straight month, according to a survey of purchasing managers.

"The global tallies for manufacturing are almost universally signaling good news; such simultaneous strength has not been present for quite a while," IHS Global Insight US economist Michael Montgomery said in a commentary.

Data in Germany and France showed higher inflation in both countries.

London rose 0.5% to a new all-time closing high of 7 177.89 points.

The Dow climbed 0.6% to 19 881.76.

Paris rose 0.4% and Frankfurt shed 0.1%. Tokyo was closed on Tuesday, but on Wednesday Asian markets were mostly up, with Tokyo leading the charge as it returned for the first day of trading after an extended new year break.

The benchmark Nikkei 225 index at the Tokyo Stock Exchange was up more than 2% in morning trade, while the broader Topix index of all first-section issues added around 1% shortly after opening.

Hong Kong and Shanghai were slightly up following gains the previous day, while Australian and South Korean shares were flat.

The Tokyo bourse finished 2016 at its highest year-end close in two decades, boosted by expectations for big government spending under US President-elect Donald Trump to further power the world's biggest economy.

But experts also called for caution, as Trump's politics and policies remain uncertain at best.

"Markets have been rallying quite strongly on this notion of fiscal hope but, as we move into the reality of 2017 and what a Trump presidency will actually look like, there is some risk of fiscal disappointment," Paul Eitelman, a strategist at Russell Investments, told Bloomberg Radio.

Women wearing traditional kimono outfits pose afte

Women wearing traditional kimono outfits pose after the opening of the stock market for the year at the Tokyo Stock Exchange in Tokyo on January 4, 2017. Tokyo shares opened higher  on the first trading day of 2017, following rises seen overnight on Wall Street driven by optimism about the US economy. (Kazuhiro Nogi, AFP)

"Any disappointment at this point could be a source of downside risk for markets from here, so we're incrementally being a bit more cautious," he said.

Oil prices retreated on worries that producers may not adhere to a major agreement of Opec and non-Opec countries to limit output.

The dollar pushed higher against the euro and other major currencies, a reversal after it spent much of the holiday season in retreat.

Among individual stocks, Ford jumped 3.8% after announcing plans to scuttle a new $1.6bn factory in Mexico and instead create 700 new jobs in the US. The announcement was hailed by Trump, who had previously attacked the plan for the investment in Mexico.

Ford's rival, General Motors, won 0.9% after Trump threatened to impose tariffs on GM's Mexican-built Chevy Cruze cars imported to the US. GM said most of its US-sold Cruze cars are built in America.

Market round-up

South Africa - JSE: Up 0.72% at 51 020.66 (close)
New York - Dow: Up 0.6% at 19 881.76 (close)
New York - S&P 500: Up 0.9% at 2 257.83 (close)
New York - Nasdaq: Up 0.9% at 5 429.08 (close)
London - FTSE 100: Up 0.5% at 7 177.89 (close)
Frankfurt - DAX 30: Down 0.1% at 11 584.24 (close)
Paris - CAC 40: Up 0.4% at 4 899.33 (close)
EURO STOXX 50: Up 0.3% at 3 317.23
Tokyo - Nikkei 225: Up 2.05% at 19 506.25 (Wed mid-morning)
Hong Kong - Hang Seng: Up 0.33% at 22 222.11 (Wed mid-morning)
Shanghai - Composite: Up 0.4% at 3 137.22 (Wed mid-morning)
Euro/dollar: Down at $1.0403 from $1.0487
Dollar/yen: Up at 117.75 yen from 117.43 yen
Pound/dollar: Down at $1.2232 from $1.2326
Oil - West Texas Intermediate: Down $1.39 at $52.33 per barrel
Oil - Brent North Sea: Down $1.35 at $55.47 per barrel

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