ROME: European stock markets erased earlier losses and turned higher on Monday after a gauge of factory activity for the eurozone unexpectedly improved.
The Stoxx Europe 600 index SXXP, +0.36% rose 0.2% to 376.12, setting it on track to break a two-session losing run. The benchmark index on Friday closed out October with an 8% advance, its best monthly performance since July 2009.
Stocks across Europe opened in negative territory on Monday after a private gauge of China’s manufacturing activity, the Caixin China manufacturing purchasing managers index, showed the sector contracted for an eighth straight month in October. The official reading on the country’s factory activity also indicated a contraction, sending stock markets lower across most of Asia.
Uncertainty over China’s growth outlook dented investment sentiment over the summer, triggering a market rout, particularly in emerging markets, and fueling concerns over the impact on global demand.
But the PMI reading for the eurozone was more uplifting, helping European stock markets turn higher in midmorning trade. The final reading on eurozone manufacturing PMI came in at 52.3 in October, up from the flash estimate of 52 and up from September’s 52 print.
France’s CAC 40 index PX1, +0.26% gained 0.2% to 4,907.33, and Germany’s DAX 30 index DAX, +0.56% rose 0.5% to 10,903.60. The U.K.’s FTSE 100 index UKX, -0.33% dropped 0.3% to 6,339.77.
Banks in focus: Banks posted some of the biggest moves in Europe on Monday after a series of earnings results. HSBC Holdings PLC HSBA, -1.08% HSBC, -0.41% 0005, -1.15% fell 1.5% after the U.K. bank said adjusted revenue fell 4% in the third quarter. The bank, however, reported a 53% jump in profit, reflecting lower fines, among other things.
Shares of Commerzbank AG CBK, +5.57% jumped 5.9% after the German lender said its turnaround plan is on track. The bank’s Chief Executive Martin Blessing announced on Sunday he will step down next year.
