LONDON (AP) - Stocks and the euro rebounded strongly yesterday after a run of buoyant economic data from around the world and mounting expectations that the European Central Bank will be stepping up its government bond purchase programme in an attempt to ease the pressure on highly-indebted Portugal and Spain.

In Europe, the FTSE 100 index of leading British shares closed up 114.23 points, or 2.1 percent, at 5,642.50 while Germany’s DAX rose 178.14, or 2.7 percent, to 6,866.63. The CAC-40 in France was 58.85 points, or 1.6 percent, at 3,669.29.

The state-affiliated China Federation of Logistics and Purchasing said its purchasing managers index - a gauge of business activity - rose to 55.2 last month from 54.7 in October. A competing index, the HSBC China Manufacturing PMI also rose solidly.

Equivalent surveys for the eurozone and Britain also confirmed that the global manufacturing recovery remains on track.

The day’s series of manufacturing surveys came to an end with another strong report into the US manufacturing sector from the Institute for Supply Management. Though its main index fell modestly to 56.9 from October’s 56.9, it was in line with expectations and means that growth in the sector remains elevated - anything above 50 indicates expansion.

The improving stock market tone, coupled with mounting expectations that the European Central Bank (ECB) will announce fresh crisis measures today following its monthly policy meeting, has helped the euro recover some ground - by late-afternoon London time, the euro was 0.8 percent higher on the day at $1.3083.

“The euro has bounced from its lows, in part on hopes for a more active ECB role in the debt crisis with markets keenly anticipating tomorrow’s ECB policy meeting,” said Vassili Serebriakov, a currency strategist at Wells Fargo Bank.

Meanwhile, the yen’s continuing decline against the dollar has helped shore up Japanese stocks, with the Nikkei 225 closing up 0.5 percent at 9,988.05 - a lower yen boosts Japan’s exports, all other things being equal.

By late-afternoon London time, the dollar was up 0.6 percent at 84.16 yen.

Elsewhere, Hong Kong’s Hang Seng gained one percent to 23,249.80 and China’s Shanghai Composite Index was up 0.1 percent at 2,823.44. Australia’s S&P/ASX 200 closed flat at 4,586.6 after figures showed the country’s economy grew by just 0.2 percent in the third quarter from the previous three months.

Benchmark oil for January delivery rose $1.40 to $85.51 a barrel in electronic trading on the New York Mercantile Exchange.