By Sara Sjolin, MarketWatch
Better-than-forecast PMIs spur optimism for second quarter
LONDON (MarketWatch) -- European stock markets started April on
a strong footing on Wednesday after a solid round of manufacturing
data, partly recovering from sharp losses the prior day when
investors banked profit ahead of the new quarter.
On Wednesday, the Stoxx 600 added 0.3% to close at 398.52, just
a few points short of its record close of 405.50 reached in March
2000.
Despite the weakness in Tuesday's session, most of the region's
benchmarks logged solid quarterly gains, with the German DAX 30
index scoring its best quarter since 2003
(http://www.marketwatch.com/story/germanys-dax-logs-best-quarter-in-more-than-a-decade-2015-03-31)
and the Stoxx Europe 600 index marking its strongest period since
2009
(http://www.marketwatch.com/story/european-stocks-climb-for-third-day-ahead-of-inflation-data-2015-03-31).
Other indexes: Germany's DAX 30 index rose 0.3% to 12,001.38 on
Wednesday, while France's CAC 40 index put on 0.6% to 5,062.22. The
U.K.'s FTSE 100 index
(http://www.marketwatch.com/storyno-meta-for-guid) climbed 0.5% to
6,809.50, buoyed by the benchmark's oil firms and banks.
Data: The gains in Europe came after the manufacturing
purchasing managers' indexes for the eurozone showed improvement in
March
(http://www.marketwatch.com/story/eurozone-manufacturing-activity-picks-up-in-march-2015-04-01).
The reading for the eurozone was revised up to 52.2, compared with
a flash estimate of 51.9. In February, the PMI was at 51. A reading
above 50 signals expansion.
"Improved economic news on the eurozone is coming pretty thick
and fast at the moment, which is a very pleasant development after
its prolonged struggles," said Howard Archer, chief U.K. and
European economist at IHS Global Insight, in a note.
He believes the eurozone is headed for gross-domestic-product
growth of 1.6% in 2015, up significantly from 0.9% in 2014.
"However, this should not mask the fact that significant
underlying structural problems remain in many countries," he
cautioned.
Germany's manufacturing PMI for March was revised up to 52.8
from an earlier reading of 52.4, to hit an 11-month high.
In France, the number was also adjusted higher, with the PMI
coming in at 48.8 compared with a flash estimate of 48.2.
Italy's manufacturing PMI jumped to its highest level in 11
months
(http://www.markiteconomics.com/Survey/PressRelease.mvc/dd7fc1af350f479d9b7bb7d6110a1df8)
in March, with the gauge rising to 53.3 from 51.9 in February.
Output and export orders grew at the fastest rates since June last
year, Markit said.
Greece developments: The Greek government and its international
lenders still struggle to reach a reform agreement and the country
could miss its EUR450 million loan repayment
(http://www.spiegel.de/wirtschaft/soziales/griechenland-will-sich-nicht-an-iwf-zahlungsfrist-halten-a-1026697.html)
to the International Monetary Fund next week, German Spiegel
magazine reported on Wednesday. Athens, however, later in the day
denied the claims, according to Reuters. Read: Warren Buffett says
eurozone could benefit from 'Grexit'
(http://www.marketwatch.com/story/warren-buffett-says-eurozone-could-benefit-from-grexit-2015-04-01)
The Athex Composite Index closed 1.3% lower at 765.37.
Draghi comments: European Central Bank President Mario Draghi
said the Governing Council wants to see inflation hardening around
the 2% level
(http://www.marketwatch.com/story/ecb-wants-inflation-to-harden-around-2-draghi-2015-04-01),
suggesting the bank will be patient in assessing when to end its
bond-buying program. The ECB launched its EUR60-a-month
quantitative-easing program in March and expects it to run until
September 2016.
Movers: Shares of Barry Callebaut AG jumped 6.6% after the Swiss
chocolate maker reported a rise in half-year sales and profit.
FirstGroup PLC climbed 6.8% after the transportation operator
said trading in the fourth quarter was in line with management's
expectations.
Shares of Dassault Systemes SA dropped 2.3% after Exane BNP
Paribas cut the software company to underperform from neutral.
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