European stocks mostly rise on China data

European stocks mostly rise on China data
Updated on

Summary Frankfurt's DAX 30 rose 0.17%to 9,960.50, but the Paris CAC 40 index fell 0.06% to 4,519.41 points.

LONDON (AFP) - Europe s stock markets mostly rose on Monday, lifted by upbeat Chinese data and growing expectations of monetary policy easing by the European Central Bank on Thursday.

London s FTSE 100 index of top companies added 0.25 percent to stand at 6,861.95 points in late morning trade.

Frankfurt s DAX 30 rose 0.17 percent to 9,960.50, but the Paris CAC 40 index fell 0.06 percent to 4,519.41 points.

The euro meanwhile held above $1.36 before this Thursday s ECB rate call.

China s manufacturing activity strengthened to a five-month high in May, the government said on Sunday, an optimistic sign amid slumping growth in the world s second-largest economy.

The official purchasing managers index (PMI) reached 50.8 in May, the National Bureau of Statistics said in a statement, up from 50.4 in March. A reading above 50 indicates growth.

The result, the third straight month of improvement, beat the median forecast of 50.6 in a survey of eight economists by Dow Jones Newswires.

"Chinese data is providing a boost for equity and commodity markets ... with stronger than expected manufacturing activity," said Rebecca O Keeffe, head of investment at online stockbroker Interactive Investor.

Mining companies were big winners in London after the upbeat data from major commodity consumer China.

Shares in Anglo American rallied 2.09 percent to 1,488 pence, topping the FTSE 100 index.

Rio Tinto added 1.75 percent to 3,110.5 pence, Glencore won 1.67 percent to 328.75 pence and Antofagasta gained 1.27 percent to 798.5 pence.

In contrast on Monday, Markit Economics revealed that its Eurozone Composite PMI for May fell to a six-month low of 52.2, from 53.4 in April.

Activity in Germany s manufacturing sector slowed more sharply than first estimated, but France was the weakest of the eurozone economies covered by the surveys -- its PMI indicated that activity fell.

"The slowdown in eurozone manufacturing activity in May reinforces belief that the ECB will deliver a package of measures at its June 5 policy meeting, including interest rate cuts and liquidity measures," said economist Howard Archer at IHS Global Insight.

"Economic conditions in the eurozone certainly justify strong action, and If the ECB fails to deliver having built up expectations, it risks upsetting the markets and also denting its credibility."

In foreign exchange deals on Monday, the euro stood at $1.3598, down from $1.3630 late in New York on Friday. The European single currency eased to 81.26 British pence from 81.39 pence.

The British pound decreased to $1.6734 from $1.6750 on Friday.

The price of gold eased to $1,243.74 an ounce from $1,250.50 on Friday on the London Bullion Market.

Asian equity markets also rose Monday, buoyed by record closes on Wall Street, as investors awaited US employment figures this week and possible European easing measures.

Tokyo rallied 2.07 percent to finish at a two-month high of 14,935.92 points, while Seoul climbed 0.35 percent and Sydney rose 0.47 percent.

Financial markets in Hong Kong, China, Taiwan and New Zealand were closed for public holidays.
 

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