UPDATE 2-European shares jump as positive PMI paints rosier picture

  • Reuters
  • Stock Market News
UPDATE 2-European shares jump as positive PMI paints rosier picture
Credit: © Reuters.

* PMI data points to manufacturing recovery

* STOXX 600 rises for the first time this week

* German shares mark best day in over two months

* Ericsson (BS: ERICAs ) slips after earnings disappoint (Updates to close, adds details)

By Ambar Warrick

Jan 24 (Reuters) - European shares rose on Friday, their first positive session of the week, as better-than-expected business activity data from the bloc pointed to a likely recovery in 2020.

The pan-European STOXX 600 .STOXX climbed 0.9%, having crossed a record high earlier in the day. The index had marked four straight sessions of declines amid widespread concerns over a new virus causing economic disruptions in China, one of the bloc's biggest trading partners.

While the HIS Markit's Euro Zone Composite Flash Purchasing Managers' Index (PMI) came in slightly below expectations, a surprise jump in manufacturing activity brewed some optimism over a return to expansion in 2020.

"With a Phase 1 trade deal in place, additional no car tariffs for the moment and some certainty about the Brexit timeline, some of the factors holding back manufacturing output have improved," ING economists wrote in a note.

"With manufacturing showing early signs of recovery and the service sector continuing to grow, chances of a recession are receding further. We are expecting growth to very gradually pick up over the course of the year."

Utilities .SX6P were among the best performing subindexes, with German renewables player RWE RWEG.DE leading gains. The utility firm's chief executive, Rolf Martin Schmitz, flagged his possible exit next year. stocks .SX8P also rose, with stronger results from U.S. chipmaker Intel Corp INTC.O bolstering the outlook for the sector. DAX .GDAXI saw its best day in more than two months after PMI data showed that the country's private sector gained momentum in January, while a pullback in manufacturing eased. bluechip stocks .FTSE closed higher after PMI data showed that Britain's services sector returned to growth in January. individual stocks, Bayer BAYGn.DE was among the biggest boosts to DAX after a report on a possible out-of-court settlement of a U.S. jury trial over allegations that its weed killer Roundup causes cancer. telecoms equipment group Ericsson ERICb.ST was on track for its worst day in about six months after it reported a smaller-than-expected rise in fourth-quarter core earnings. Tyres TYRES.HE hit a more than four-year low as the Finnish tyre maker forecast its 2020 sales and operating result to significantly decline from a year earlier due to weak performance in its Russia operations. of French pharma company Ipsen IPN.PA tumbled to the bottom of the STOXX 600 after it paused dosing in rare bone diseases drug Palovarotene.

Drop an image here or Supported formats: *.jpg, *.png, *.gif up to 5mb

Error: File type not supported

Drop an image here or