Euro-zone PMI shows unexpected January growth (by William L. Watts)

FRANKFURT (MarketWatch) -- Private-sector economic activity in the 17-nation euro zone showed small but unexpected growth in January, according to preliminary data from a survey of purchasing managers released Tuesday. The preliminary Markit euro-zone composite purchasing managers index rose to 50.4 from 48.3 in December. A reading of less than 50 signals contraction, while a figure of more than 50 indicates growth. Economists had forecast a reading of 48.5. The services PMI rose to 50.5 from 48.8 in December, while the reading for the manufacturing sector rose to 48.7 from 46.9. The data indicates the economy has stabilized after contracting in the final quarter of 2011, said Chris Williamson, chief economist at Markit. The rebound largely reflected an upturn in Germany and very modest growth in France, while the rest of the region continued to suffer a steep downturn, he said.

Euro-zone Nov. industrial orders fell 1.3% (by William L. Watts)

FRANKFURT (MarketWatch) -- Industrial orders in the 17-nation euro zone fell 1.3% in November after a 1.5% rise in October, the European Union statistics agency Eurostat reported Tuesday. Compared to November 2010, orders fell 2.7%, the agency said. Economists had forecast a 2.3% monthly decline and a 2.8% year-on-year fall.

Worries Portugal may need second bailout: WSJ (by Barbara Kollmeyer)

MADRID (MarketWatch) -- Fresh worries have been raised over the potential of a second bailout for Portugal amid concerns the country may not be able to get financing on the open market next year. According to an article in The Wall Street Journal on Tuesday, there are concerns that the International Monetary Fund could make fresh demands on Portugal if it becomes clear it can't return to the market, which it must do next year to help repay €9 billion ($11.64 billion) in debt due Sept. 2013. Bond yields and the cost of insuring Portugal against default are at record levels, and investors are worried holders of the country's debt will suffer losses, the same as in Greece.

Greece's Venizelos: 'Green light' to finish talks (by William L. Watts)

FRANKFURT (MarketWatch) -- Greek Finance Minister Evangelos Venizelos on Tuesday said euro-zone finance ministers gave Greece the "green light" to conclude talks with private creditors over a voluntary write-down of the country's public debt. "We have the green light from the Eurogroup to close the deal with the private sector in the next few days," Venizelos said ahead of a meeting of European finance ministers in Brussels, according to a statement released by his office. A meeting of euro-zone finance ministers on Monday in Brussels saw Germany and the International Monetary Fund push for an average interest rate on restructured Greek debt of less than 4%, in conflict with private creditors who have pushed for a coupon above that level, The Wall Street Journal reported.

IIF's Dallara urges Greek debt swap deal (by Steve Goldstein)

WASHINGTON (MarketWatch) -- The head of the group negotiating a voluntary Greek debt swap on behalf of private creditors said Tuesday that it was important for market stability that a deal be reached. Institute of International Finance Managing Director Charles Dallara said it was important that all parties honor an October commitment for private creditors to accept 50% less, as he said the coupon that creditors will accept is still under discussion. Talks on a deal have languished ahead of the next International Monetary Fund and European Union planned aid disbursement to Greece. He said not just Greek but European stability is at risk. IIF slashed its forecast of capital flows to emerging markets, cutting its 2012 estimate to $746 billion from $1.08 trillion, citing bank deleveraging as a result of the European debt crisis.