Home Stock European Stocks Higher; PMI Data Indicate Slowing Recovery

European Stocks Higher; PMI Data Indicate Slowing Recovery

imageStock Markets28 minutes ago (Sep 23, 2021 04:06AM ET)

(C) Reuters

By Peter Nurse

Investing.com – European stock markets traded higher Thursday, despite business surveys indicating a regional slowdown, as sentiment surrounding the heavily indebted property group China Evergrande (HK:3333) improved and the Federal Reserve delayed tapering its asset purchases.

At 4:05 AM ET (0805 GMT), the DAX in Germany traded 1% higher, the CAC 40 in France rose 0.9% and the U.K.’s FTSE 100 climbed 0.5%.

Germany’s economic recovery from the Covid-19 pandemic lost momentum in September, with its flash Purchasing Managers’ Index showing growth in the manufacturing sector slowed to an eight-month low reading of 58.5 from 62.6 in August.

There was a similar story in France, as the country’s preliminary composite Purchasing Managers Index – factoring in both the services and manufacturing sectors – fell to 55.1 points in September from 55.9 in August.

Later in the session, the Bank of England announces its latest monetary policy decision later in the session, but the central bank is not expected to change its record-low interest rates or the extent of its asset purchases. The central bank of Norway, however, raised its key rate to 0.25%, becoming the first major advanced economy to do so since the pandemic. Turkey’s central bank also meets later.

Global sentiment had improved following the conclusion of the latest Federal Reserve policy-setting meeting, when the U.S. central bank indicated that it will likely begin reducing its monthly bond purchases towards the end of this year. That was a positive surprise for the minority who had expected an immediate start to the withdrawal of the stimulus that has been supporting the economy during the pandemic.

Also helping the tone were solid gains in Chinese markets Thursday, after the People’s Bank of China injected more money into the banking system, easing concerns about the fallout from China Evergrande’s debt crisis.

In corporate news, Royal Mail (LON:RMG) stock dropped 0.7% after the group warned about rising costs while reporting a 9% fall in total parcel deliveries by volume across July and August.

French car parts company Faurecia (PA:EPED) stock rose 6.7% even as it lowered its main 2021 financial targets due to a sharp reduction in worldwide automotive production on the back of a semiconductor chip shortage.

Crude prices edged higher Thursday, supported by another decline in U.S. oil stocks as production in the important Gulf of Mexico region remained hampered by the damage caused by two recent hurricanes, while U.S. crude stockpiles fell to a three-year low.

By 4:05 AM ET, U.S. crude futures traded 0.1% higher at $72.27 a barrel, while the Brent contract gained 0.1% to $76.23.

Additionally, gold futures fell 0.7% to $1,766.65/oz, while EUR/USD traded 0.2% higher at 1.1713.

European Stocks Higher; PMI Data Indicate Slowing Recovery

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