Markets rallied strongly on the first trading day of 2013 after the US Congress averted the so-called fiscal cliff with a last-minute deal. The S&P 500 jumped 2.5 percent while the Stoxx Europe 600 climbed 2.0 percent.
Markets rose despite weak data from Europe. Markit's eurozone manufacturing PMI fell to 46.1 in December from 46.2 in November.
However, economic data elsewhere had been more supportive for markets.
The Markit/CIPS UK manufacturing PMI jumped to a 15-month high of 51.4 in December from 49.2 in November.
In the US, manufacturing also returned to growth in December, with the Institute for Supply Management's manufacturing PMI rising to 50.7 from 49.5 in November. Markit's manufacturing PMI painted an even better picture, rising to 54.0 in December from 52.8 in November.
Marring the picture somewhat was a 0.3 percent fall in construction spending in the US in November, the first decline in eight months.