- China manufacturing expands
- Spain's jobless rate falls
- Eurozone PMI Composite declines
- US weekly initial jobless claims drop
FTSE 100: 0.55%
CAC 40: 0.34%
FTSE MIB: 1.28%
IBEX 35: 0.78%
Stoxx 600: 0.41%
European stocks rallied on the back of an upbeat Chinese manufacturing report and an unexpected fall in Spain's jobless rate.
HSBC's purchasing managers' index (PMI) for manufacturing in China rose to 50.9 in October from 50.2 last month, beating the 50.4 forecast. A reading above 50 signals expansion.
"This is a very encouraging sign and, if the rest of the data hadn't already done this, all but guarantees that growth in China this year will exceed the minimum 7% threshold set by the government, and probably its own targets from the start of the year of 7.5%," said Craig Erlam, Market Analyst at Alpari.
"Anything that's good for Chinese growth is viewed as positive for the global economy, which is why we're seeing European indices on the rise again this morning, following the brief pull back yesterday."
Stocks were in the red yesterday as concerns over a spike in money-market rates in China and nervousness ahead of a round of stress tests for European banks weighed on investor sentiment.
In another boost to markets today, Spain's jobless rate declined in the third quarter to 26% from 26.3% in the previous quarter, compared to the consensus of 26.1%, the National Statistics Institute revealed.
The busy tourist season between July and September lifted the jobs market.
The country's central bank yesterday estimated that Spain's economy grew for the first time in two years in the third quarter, exiting the second recession since 2008.
In the Eurozone, the PMI Composite - which includes manufacturing and services activity - fell to 51.5 this month from 52.2 in September, Markit Economics revealed. Economists had pencilled in a reading of 52.4, signalling that the recovery in the currency bloc is struggling to gain momentum.
"The manufacturing and services PMIs out of the Eurozone, while mostly missing expectations, were also still very encouraging," Erlam added.
"While some also fell slightly from last month's levels, the fact that only the French manufacturing PMI remains in contraction territory must be seen as a positive thing."
US jobless claims fall
Weekly US initial jobless claims fell by 12,000 in the week ended October 18th to 350,000 from a revised 362,000, though it missed the consensus forecast of 340,000.
The higher-than-expected figure was partly due to the effects of the government shutdown as well as the continuing impact of a computer-system upgrade in California last month.
Meanwhile, the four-week moving average of claims increased by 10,000 on the prior week to 348,000.
"It is unclear how long the technical issues in California and government shutdown effects will persist, but both remain upside risks for jobless claims in coming weeks," said analyst Cooper Howes from Barclays.
In other economic data, Markit's flash US PMI for the manufacturing sector fell from 52.8 to 51.1 in October, missing the 52.5 estimate.
The trade deficit increased slightly to $38.8bn in August from a downwardly-revised $38.6bn the month before, though this was slightly under analysts' forecasts.
Ophir Energy, Daimler
Ophir Energy after the UK oil and gas explorer said it has started talks to sell assets in Tanzania.
Daimler gained after the maker of luxury vehicles reported third-quarter earnings that beat analysts' forecasts.
ABB climbed after the maker of power transformers reported earnings that topped estimates amid growing orders in China and Germany.
Celesio rallied after McKesson Corp. agreed to buy the German drug wholesaler for €3.9bn.
SEB AB advanced after the Swedish bank posted third-quarter net income that exceeded analysts' projections.
Credit Suisse Group fell after the Swiss bank reported second quarter profit that missed analysts' expectations.
Ericsson dropped after the maker of wireless-network equipment reported profit and sales that fell short of consensus.
Brent crude declines
Brent crude futures fell $0.382 to $107.390 per barrel on the ICE.
The euro increased 0.17% to $1.3799.