By Sara Sjolin, MarketWatch
LONDON (MarketWatch) -- Europe's stock markets showed
broad-based gains on Thursday as investors largely ignored a mixed
bag of purchasing managers indexes from the region and instead used
recent market weakness as a buying opportunity.
"Markets have developed a remarkable ability to shrug off the
bad and have needlelike focus on the positive," said Jonathan
Sudaria, dealer at London Capital Group, in a note.
The Stoxx Europe 600 index is down 0.8% over the past three
months, largely due to geopolitical issues in Ukraine, Iraq and
Gaza. Peter Dixon, strategist at Commerzbank, said Thursday's move
higher was more due to an unwinding of the "collapse" we saw in
late July and early August rather than a bright view of the future.
Read: Russia-exposed stocks tank 15% since start of Ukraine
conflict
"There is definitely an underlying story, which is the euro zone
losing some momentum. It will play a much bigger role in investors'
thinking in September," he said.
Data: The PMIs coming out of Europe were mixed. The readings for
the overall euro zone missed expectations, with particularly the
manufacturing sector showing signs of weakness. Activity at the
currency union's factories remained in expansion territory at 50.8
in August, which, however, was a 13-month low. A reading above 50
indicates expansion.
Germany's PMIs actually surprised to the upside, although they
slipped from July. The story was more mixed in France, where the
services PMI climbed to a five-month high, but the manufacturing
PMI tanked to a 15-month low.
In China, HSBC's manufacturing PMI showed factory activity in
the world's second largest economy weakened to a three-month low in
August, sending miners listed in London lower. Mining firms are
sensitive to weakness in China's industrial sector, as it is a
major user of natural resources.
Market reaction: The Stoxx Europe 600 climbed 0.7% to end at
337.51, marking the highest closing level since late July. Read:
Raiffeisen rallies, miners slip: Europe movers
Germany's DAX 30 index gained 0.9% to 9,401.53, while France's
CAC 40 index picked up 1.2% to 4,292.93. The U.K.'s FTSE 100 index
added 0.3% to 6,777.66. Read: Miners drop in London after weak
China PMI
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