U.K. stocks retreated as a report showed growth in China’s services industries slowed last month, and lawmakers tightened mortgage rules to cool the residential property market in the world’s second-largest economy.
The fastest profit growth since 2004 will push European stocks up 15 percent by January, handing investors the biggest two-year advance in a decade, according to estimates from 13 strategists surveyed by Bloomberg.
U.K. stocks rallied the most in three months as concern that Europe’s sovereign-debt crisis will spread eased and a report showed that Chinese manufacturing expanded for a fourth month, boosting raw-material companies.
European stocks tumbled to an eight- month low as signs of weakness in the Spanish banking system increased concern that Europe’s debt crisis is spreading and military tensions grew in the Korean peninsular.
European equities will climb 12 percent through the end of next year, beating 2010’s gains, as rising earnings and record-low interest rates help companies overcome the sovereign-debt crisis, a Bloomberg survey of 13 strategists shows.