Europe close: Stocks start December off on front foot
By Alexander Bueso
Date: Thursday 01 Dec 2022
(Sharecast News) - European stocks made a bright start to trade in December as investors responded to what some analysts said was US Federal Reserve Chair Jerome Powell's decision not to push back on the recent easing in financial conditions and digested a swathe of economic data.
Powell on Wednesday night said the Fed could start scaling back the pace of rate rises "as soon as December", but warned that the battle to stymie soaring inflation was not over.
Markets in Asia rallied overnight after a report China could allow some people who test positive for Covid to quarantine at home, as the Beijing leadership looks to stop rising protests from citizens angry about the country's strict zero-tolerance pandemic restrictions. Investors also shrugged off weak China PMI data.
The pan-regional Stoxx 600 was up 0.89% at 443.96, alongside a 0.65% gain for the German Dax to 14,490.30 while Spain's Ibex 35 added 0.53% to 8,407.90.
In parallel, the yield on the benchmark 10-year German bund was 12 basis points lower to 1.815% and euro near 1.05 versus the US dollar.
On the economic front, unemployment across the eurozone nudged lower in October, official data showed. The seasonally-adjusted unemployment rate was 6.5%, down from 6.6% in September 2022 and 7.3% in October 2021. Consensus had been for no change month-on-month.
Across the wider bloc, the rate was 6.0%, down on both September's 6.1% and the 6.6% recorded in October 2021.
The slowdown in eurozone manufacturing activity eased in November, according to a survey released on Thursday.
S&P Global's final manufacturing purchasing managers' index for the sector rose to 47.1 from 46.4 in October, coming in below a flash estimate of 47.3 but ahead of the 50.0 mark that separates contraction from expansion.
The survey also showed that there was a further easing of inflationary pressures, in part due to weaker demand and reduced strain on suppliers.
German retail sales fell a more-than-expected 2.8% in October compared with the previous month, according to official data.
In equity news, Dutch food group Corbion shot higher by 13% after its investors' day presentation.
Belgian biopharmaceutical company UCB fell 7% after JPMorgan cut its target price for the stock.
Educational publisher Pearson was knocked lower by a downgrade to 'neutral' at Exane.
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