European Markets FTSE,DAX and CAC gained after investors were speculative that the US economy is strengthening

European Markets FTSE,DAX and CAC gained after investors were speculative that the US economy is strengthening.Mike Lenhoff, chief strategist at Brewin Dolphin, said: “Moving on from where it left off last week, I think the equity markets are focusing on the growth that is out there and are being supported by strong earnings. The markets are reluctant to give up any ground and the underlying trend is up."Across Europe,the UK’s FTSE 100 and the DAX gained 0.9 percent and the CAC 40 rose by 1.1 percent. rnThe Nikkei rose as company earnings rose and lower US unemployment numbers helped stop declines in energy stocks. Nadar Naeimi, a sydney based strategist at AMP Capital Investors Ltd, said: "The stronger than expected earnings are confirming what we're seeing in the economic data. Equity markets are still vulnerable to profit taking given the strong gains last year, as well as to building inflationary pressures.”The benchmark Nikkei 225 rose 0.5 percent at 10,543.52. The Hang Seng Index fell 1.1 percent.rnThe euro was mainly down after weak German manufacturing data kept investors away on fears of rising interest-rates in the euro zone. Vassili Serebriakov, currency strategist at Wells Fargo in New York,said: “Last week's less hawkish comments from ECB President Trichet remain key to the recent turn around in the euro and the currency appears vulnerable to further downside, a factor that could contribute to a broadly stronger US dollar in the coming days.”However, the pound rose against the dollar and the euro,after rise in UK government notes of two years, on speculation that the Bank of England may raise borrowing costs this year. The euro was down 0.01 percent at $1.3586. The pound advanced to $1.6124. rnAgainst the euro, the pound rose 0.5 percent to 83.89 pence per euro.rnOil fell as political turmoil in Egypt continued to keep investors on the tenterhooks that oil supply may be effected.Phil Flynn, an analyst at PFGBest Research in Chicago, said: “Oil prices fell as Egypt did not continue to descend into chaos and the employment number was a disappointing jumbled mess." rnThe DOW and S&P rose, but the Nasdaq fell . James Dunigan, chief investment officer at PNC Wealth Management in Philadelphia, said: “The size of these deals is an indication that the buyers feel comfortable putting that cash to work while the companies being bought are undervalued. The level of the broader market is reasonable, but there are these individual situations that deserve a higher premium than the market is getting over all."The Dow Jones Industrial Average rose 69.40 points at 12,16155.The Standard & Poor's 500 added 8.18 points to 1,319.05. The Nasdaq Composite Index climbed 14.69 points at 2,783.99.rnGold rose as inflation and interest rate hike fears kept investors tilted towards safe haven assets.Peter Buchanan, senior economist at CIBC World Markets, said: “Fed tightening expectations have been hurting gold, but we still feel the odds of a rate hike this year, or even the first half of 2012, are pretty low."US Gold futures for April delivery settled down 80 cents at $1,348.20 an ounce. rnGerman bonds fell with yields rising as European leaders, along with German leader Chancellor Angela Merckel, are devising a program to counter and end euro-zone debt crisis.Pierre Lequeux, London-based head of currency management at Aviva Investors, said: “Merkel is totally on top of this situation,she understands how much of a benefit the euro has been for Germany. The only way they can fend off inflation is by engineering a stronger euro. As we’re going through the first quarter the euro will get stronger.”rnUS Bonds fell taking yields higher above technical levels. A trader said: "There have been a lot of stop losses triggered through 3.50 (percent) at the New York close so a lot of pain went through the market in the overnight session. It seems the market was not happy with where the yields were and people are focusing on the new unemployment rate of 9 percent."