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. Last Updated: 07/27/2016

European Markets Hit Highs

LONDON -- European financial markets pushed sharply higher Tuesday after U.S. economic data eased fears about inflation and rising interest rates.

U.S. treasury bonds immediately jumped higher after the release of subdued consumer price index and retail sales figures for December, and Wall Street followed suit.

Records tumbled across Europe as investors responded by pushing stock markets up on the belief that the American figures eased pressure on the U.S. Federal Reserve to raise rates.

The dollar zoomed to its highest against the mark since July 1994, hitting 1.5973 marks. It also reached 117.04 yen but was unable to hold above 117.

At least 10 European stock markets recorded record highs during the day, with most of them closing at a peak.

"The bond market is very strong, the dollar is rising sharply, the U.S. figures were in line with expectations -- all is for the best in the best of all possible worlds," said EIFB analyst Pierre Vignaud in Paris.

It turned out that core CPI figures for December were subdued and Christmas shopping boosted retail sales slightly more than expected.

Economists interpreted the figures showing that consumers had held spending in check, which should curb inflation and reduce pressure on interest rates.

French stocks stormed to a powerful close, with the CAC-40 index ending at a record close of 2,402.14 for a rise of 1.73 percent. The CAC-40 futures contract rose 38.5, to 2,406.

London shares posted strong gains for the second day in a row, as fears of an imminent rise in interest rates subsided on both sides of the Atlantic.

Led by surging bank and supermarket stocks, the FTSE 100 finished 60.9 points higher at a record 4,168.2. The rally has added ?18.8 billion ($31.44 billion) to blue-chip stocks over the past two sessions.

German shares, which were lagging early as investors held back, staged an afternoon surge with the IBIS DAX hitting a record 2,984.32 points in post-exchange electronic trading.