US data boosts stocks, oil falls on Opec worries

New York - Strong US economic data provided support to global stocks on Tuesday despite worries about Organisation of Petroleum Exporting Countries (Opec) talks and a weekend referendum in Italy that could inject more uncertainty into the eurozone.

US data showed stronger-than-expected third quarter growth, higher housing prices in September and a sharp rebound in consumer confidence in November.

"Guess what? The economy isn't terrible," economist Joel Naroff said.

"Now I know some people pick and choose what they like or don't like about the data, but economists are stuck actually having to look at all the numbers and right now they look pretty good."

The sunny figures helped push US stocks modestly higher, while Paris and Frankfurt also advanced.

But London retreated 0.4%, in part due to weakness in petroleum shares due to a nearly 4% drop in US oil prices to $45.23 a barrel.

All eyes are on Opec to see whether it is able to agree on Wednesday to reduce the cartel's gushing crude that has long hurt producers and slashed prices.

Concerns are growing that members will not be able to hammer out details of a broad accord reached in September to reduce output and support prices, as Iran and Iraq are saying they should be exempt.

"At the minimum, we've got some brinkmanship between Opec countries, so they're daring each other’s to let the prices collapse by threatening not to cut production," said Michael Lynch of Strategic Energy and Economic Research.

Capital Economics analyst Tom Pugh said Opec knows the stakes.

"The group will be well aware that a failure to come up with any agreement could see prices plunge back below $40 per barrel and make it difficult for Opec to convince the market that it is able to function effectively."

Investors also were nervously anticipating a referendum on Sunday in Italy on a constitutional reform. Prime Minister Matteo Renzi has suggested he would step down if voters reject the proposal.

There are fears his resignation could spark elections in which populist anti-euro parties could do well, and possibly even lead to the country leaving the EU.

The outcome also could throw into doubt measures to fortify Italy's struggling banking sector.