by Amanda Cooper

LONDON (Reuters) – Global shares rose on Tuesday after gains in Asia lifted the yuan after China promised to boost support for its faltering economy, while evidence of a slowdown in European growth hurt the euro.

China’s top leaders late on Monday pledged increased aid for the economy, which is struggling to maintain a post-COVID recovery, and indicated more would be in store for the property industry.

The MSCI All-World index rose 0.2%, boosted by gains in the Chinese stock market, where the mainland index rose 1.9% and Hong Kong shares gained 3%, buoyed by a jump in property shares that were diving on debt repayment concerns. [.HK][.SS]

But the positive momentum did not continue in Europe, where stocks and the euro struggled to stay in positive territory, as worries about a recession re-emerged a day earlier after regional surveys showed business activity contracted more than expected in July.

“There are a few things. First, as far as European and US traders are concerned, there are almost bigger fish to fry in this part of the world, the Fed comes out tomorrow night and then the ECB on Thursday,” said Michael Brown, market strategist at TraderX.

“The second thing is that this week, and certainly since Monday morning, we’ve seen a big change in the data coming out of Europe. The PMIs were, frankly, disastrous,” he said.

Monday’s purchasing managers’ indexes came in lower than expected for the entire euro area as well as major economies such as France and Germany, prompting traders to reconsider what the European Central Bank might signal in terms of the rate outlook when it meets on Thursday.

Tuesday’s macro release offered evidence of a slump in business confidence in Germany this month, and credit demand in the euro area hit a record low in the second quarter, according to an ECB survey, as rising interest rates took their toll.

The Federal Reserve issues its decision on monetary policy on Wednesday.

Markets are expecting rate hikes of 25 basis points from both the Fed and the European Central Bank this week, but pricing beyond that remains separate from policy makers’ rhetoric, meaning a lot of focus will be on their tone and outlook.

Europe’s miners cheer China

Europe gained 0.2% on the day, led partly by shares in mining companies that rose after China signaled it intended to prop up the economy.

Consumer conglomerate Unilever (NYSE: ), which makes Dove soap and Ben & Jerry’s ice cream, rose 5% after beating underlying quarterly sales growth forecasts that put it in positive territory.

In currencies, it rose 0.7% to 7.1386 against the dollar after stimulus measures helped by state banks selling onshore and offshore dollars in Asia.

An index measuring the US currency’s performance against six others declined 0.1% to 101.34.

The Australian dollar, which serves as a liquid proxy for the yuan, rose 0.5% to $0.677, while the euro struggled to pull above a two-week low. It was last up 0.1% at $1.1076.

The Japanese yen edged higher against the dollar, falling 0.2% to 141.27. Investors are confused about whether the Bank of Japan, which meets on Friday, could change its policy of keeping lending rates close to zero.

In the US, Microsoft (NASDAQ: ), Google parent Alphabet (NASDAQ: ), Visa (NYSE: ), general Electric (NYSE: ), chip maker Texas Instruments (NASDAQ: ) are among the giants to report in the coming day or two.

On Wall Street, the Dow Jones closed higher for the 10th day on Monday, its longest run of daily gains since 2017. This year’s tech-led rally finally seems to be spreading across the market, and investors are excited about this week’s earnings report.

Morgan Stanley (NYSE: )’s Mike Wilson, perhaps this year’s most prominent equity shareholder and whose call for a lower earnings call was based on poor earnings, said Monday: “We were wrong”.

In the energy market, both futures were flat on the day at $82.71 per barrel and $78.74 per barrel, respectively.