- Eurozone manufacturing rises, services fall
- Chinese manufacturing slows
- ECB's Asmussen steps down
- Positive US data boosts expectations for Fed tapering
FTSE 100: 1.28%
CAC 40: 1.48%
FTSE MIB: 2.34%
IBEX 35: 1.69%
Stoxx 600: 1.26%
European equities gained after a better-than-forecast Eurozone manufacturing report and following the release of positive US data that fuelled speculation of a stimulus reduction by the Federal Reserve.
Markit's flash reading for the Eurozone purchasing managers' index (PMI) in December climbed to 52.7 from 51.6 in November. It exceeded the consensus forecast for a reading of 51.9 and the 50 level that signals expansion.
"It's really encouraging to see the increase in the overall rate of growth. It's a reassuring signal that the recovery is still on track. We are not losing momentum," said Chris Williamson, Chief Economist at Markit.
However, PMI services in the Eurozone dropped to 51 this month from 51.2 in November, missing economists' expectations of 51.5, as firms in the sector were forced to slash prices to gain business.
In China, the Markit/HSBC manufacturing PMI report was unveiled last night, falling to 50.5 in December from 50.8 in November, missing the 50.9 estimate.
Asmussen leaves ECB, Draghi cracks down on banks
Jörg Asmussen today announced plans to leave the European Central Bank (ECB) which could increase pressure on the Eurozone monetary authority leader Mario Draghi.
Asmussen will leave his ECB executive board post to take a position as Deputy Labor Minister in Germany's new coalition government, even though his term at the central bank was not supposed to end until 2019.
Asmussen said his departure was a purely private decision. "The seat of the ECB in Frankfurt with my family with my two very young children in Berlin were not compatible over the long term," he said in his departure statement.
Asmussen has been a key supporter for ECB President Mario Draghi defending monetary policies throughout the crisis.
Separately Draghi urged governments to ramp up efforts to create an authority backed by single funds to swiftly resolve failing financial institutions in the Eurozone.
"I am concerned that decision-making may become overly complex and financing arrangements may not be adequate," Draghi said in testimony to European parliament in Brussels.
Federal Reserve policy meeting
The Federal Reserve will hold its policy meeting on Wednesday when the US central bank may announce a scaling back of its monthly $85bn bond buying programme.
A slate of upbeat economic data has led some to believe the Fed will begin tapering this week.
Today's release of upbeat industrial and manufacturing data increased the stakes of a reduction to asset purchases.
"With a decent string of data out of the US recently, notably from the labour market, and an easing of the fiscal situation due to the latest budget deal in Washington, the Fed have a bolder case to taper," said Ishaq Siddiqi, Market Strategist at ETX Capital.
Aggreko was firmly higher after saying it expects full-year results to be slightly higher than previous expectations.
Carrefour rallied after agreeing to buy a portfolio of 127 shopping malls in France, Spain and Italy from real estate group Klepierre for €2bn. Klepierre also gained.
UBM fell after results from the publisher of InformationWeek suggested its 2014 margins forecast for its events unit is below estimates.
ArcelorMittal slumped as Nomura Holdings cut its recommendation on the steelmaker to 'reduce' from 'buy', citing falling steel prices.
The euro was up 0.11% to $1.3756.
Brent crude increased $1.520 to $110.510 per barrel on the ICE.