LONDON: European shares edged up on Tuesday as investors braced for the next round of the European Central Bank's (ECB) injection of cheap cash for banks, a major factor in driving the market's rally in 2012.
Strategists said equities will benefit further from the funding move, and that European stocks exposed to the US economy may gain. The Dow Jones rose above 13,000 again after upbeat US consumer confidence data.
"I don't think the market will be disappointed with the LTROs (Long Term Refinancing Operation). I think it can still progress from here. And some stocks quite exposed to the US economy still look cheap," said Colin McLean, managing director at SVM Asset Management in Edinburgh.
The ECB's second offering of cheap three-year loans is expected to allot 500 billion euros ($670 billion), according to a Reuters poll.
The FTSEurofirst 300 index of top European shares rose 0.2 percent to a provisional close of 1,076.32 points and is up 7.5 percent in 2012.
British housebuilder Persimmon soared 12.8 percent, after the firm unveiled plans to return 1.9 billion pounds of surplus cash to shareholders.
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