LONDON, ENGLAND - European stock markets rallied Wednesday, with London spiking to a 12-month high on positive news from miner Rio Tinto and better-than-expected results from US computer chip giant Intel, traders said.

Equity traders also kept a keen eye on the tumbling dollar, which struck a 14-month low point against the euro, helping to push crude oil above 75 dollars a barrel and gold to a record high above 1,070 dollars an ounce.

In intra-day trade, London's FTSE 100 benchmark index reached 5,258.23 points - the highest level since late September, 2008. The FTSE later stood at 5,253.71 in midday deals, up 1.93 percent from Tuesday.

Elsewhere on Wednesday, Frankfurt's DAX 30 won 2.47 percent to reach 5,858.12 points and in Paris the CAC 40 climbed 2.09 percent to 3,878.9 points near the half-way stage.

The DJ Euro Stoxx 50 index of top eurozone shares rose 2.45 percent to 2,949.28 points.

"The FTSE is back above 5,200, with the mining sector largely responsible," said Philip Gillett, sales trader at spread-betting firm IG Index.

"Rio Tinto leads the FTSE 100 leaderboard, boosting the sector after the dual fillip of raising full-year production targets and better-than-expected iron ore prices.

"Also riding the mining wave are Xstrata and Kazakhmys, with all three resources giants more than five percent ahead."

Mining giant Rio Tinto on Wednesday said iron ore production reached record levels in the third quarter, defying the global downturn and frictions with key market China.

The Anglo-Australian company said iron ore production was up 12 percent in the third quarter compared to a year earlier, setting a new quarterly record, with sales to China "maintained at a high level."

Rio shares leapt 5.67 percent higher to 3,009.5 pence on the FTSE 100.

"Investors are also encouraged by the continuing stream of better-than-predicted third-quarter earnings news, the latest from technology giant Intel last night," said Gillett.

"Overall, and bar the odd blip, global markets are largely continuing their upward journey. For the rest of this week, the US earnings season will be watched closely for further pointers towards the strength of global economic
recovery."

Intel shares soared in after-hours US trading on Tuesday after the world's biggest computer chipmaker delivered earnings that beat estimates and an upbeat forecast for the remainder of the year.

The US company said net profit fell five percent in the third quarter compared with the same period last year to 1.9 billion dollars, or 33 cents per share, which was better than the 28 cents expected by Wall Street analysts.

In foreign exchange trade on Wednesday, the dollar slumped to a 14-month low versus the euro, pushing the price of gold to a record high and crude oil futures above 75 dollars for the first time in a year.

The euro struck 1.4920 dollars - its highest point since August 2008 - on increased risk appetite and prospects of super-low US interest rates for some time amid rising economic confidence, analysts said.

Earlier Wednesday, Tokyo closed down 0.16 percent as investors took profits after five straight daily gains, with a firmer yen weighing on exporters, traders said.

Wall Street had limped to a mixed finish on Tuesday as jitters about the upcoming wave of corporate earnings offset the positive impact of a big acquisition in the tech sector. --AFP