European Stocks Pull back After Best Week of The Year
European stock markets headed lower on Monday as investors digested a mixed bag of data from the eurozone and China.
The weakness came after the Stoxx Europe 600 index SXXP, -0.80% scored its biggest weekly gain of the year on Friday on the back of a surprise stimulus announcement from the Bank of Japan.
Monday’s market reaction: The Stoxx 600 fell 0.4% to 335.54, on track to break a four-day winning streak.
Germany’s DAX 30 index DAX, -0.84% DAX, -0.84% gave up 0.5% to 9,284.06, while France’s CAC 40 index PX1, -0.97% lost 0.4% to 4,215.16.
The U.K.’s FTSE 100 index UKX, -0.87% traded 0.2% lower at 6,533.60. The pound GBPUSD, +0.17% rose to $1.6006 from $1.5999 on Friday, after better-than-expected U.K. data.
Meanwhile, final readings on manufacturing purchasing managers indexes for France, Germany and the eurozone painted a mixed picture of European factory activity. Read: Don’t miss these 5 highlights in Europe this week
For the eurozone, the PMI stood a 50.6, higher than the 50.3 in September, but slightly lower than the 50.7 flash estimate.
In France, output of manufacturers fell further in October, with the PMI slipping further to 48.5 from 48.8 in September. However, it was better than the preliminary reading of 47.3.
The data for Germany signaled a return to growth for the manufacturing sector in October. The PMI climbed from September’s 15-month low of 49.9 to 51.4. The flash estimate was 51.8.
Christian Schulz, senior economist at Berenberg, said Germany was the main driver for the overall rebound in eurozone factory activity.
“That is encouraging given that it was Germany, which has by far the largest manufacturing base in Europe, where the current eurozone economic rough patch originally started in early spring after Russia’s aggression against Ukraine began,” he said in a note.
In the U.K., the manufacturing PMI climbed to the highest level in three months and beat expectations.
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Source: MarketWatch
