Global markets have spring in their step at start of new month
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London — Stocks started September on a positive note, with global indices close to record highs and Europe edging higher, pushed up by Chinese factory data that showed a rebound in demand.
Factory activity in China expanded at the fastest rate in nearly a decade in August, a private PMI survey showed on Tuesday, contrasting with an official survey on Monday that showed output in the country's factories grew slightly more slowly last month as floods hit the southwest.
Both surveys pointed to improving export orders.
The MSCI world equity index, which tracks shares in 49 countries, was close to its highest ever, while the pan-European Stoxx 600 was up 0.2% at 0809 GMT.
France's Cac 40 was up 0.4% and Germany's Dax was up 0.6%. Britain's FTSE 100 lagged, down 0.9%.
European stocks had opened even higher but pared gains after the German government revised down its GDP forecast for 2021.
PMI data from across Europe showed manufacturing activity generally on the path to recovery though factory managers are wary about investing and hiring more workers.
In Germany, Europe's largest economy, output grew at its fastest pace since February 2018, while in France it contracted.
The eurozone economy has experienced a strong recovery in the third quarter even though the most recent incoming data have been less robust, European Central Bank vice-president Luis de Guindos said.
The euro rose to a two-year high of $1.19975 at 3.24am GMT. At 8am GMT it was at $1.199, up 0.4% since New York's close, as a dollar sell-off continued.
Versus a basket of currencies the dollar was down 0.4% at 91.8811 at 8.10am GMT, dropping below 92 for the first time since May 2018.
Investors are betting on US rates staying lower for longer after Federal Reserve chair Jerome Powell on Thursday outlined an accommodative shift in the central bank's approach to inflation.
Eurozone inflation data for August was due this morning and was expected to show a decline to 0.2%, according to a Reuters poll.
Commerzbank analyst Esther Reichelt said inflation data highlights the difference between the Fed and the ECB.
“Whereas the market considers the Fed capable of rekindling inflation rates by leaving interest rates lower for longer than previously assumed, this does no longer seem to be the case as far as the ECB is concerned,” she wrote in a note to clients.
“Inflation data for August published today ...
Factory activity in China expanded at the fastest rate in nearly a decade in August, a private PMI survey showed on Tuesday, contrasting with an official survey on Monday that showed output in the country's factories grew slightly more slowly last month as floods hit the southwest.
Both surveys pointed to improving export orders.
The MSCI world equity index, which tracks shares in 49 countries, was close to its highest ever, while the pan-European Stoxx 600 was up 0.2% at 0809 GMT.
France's Cac 40 was up 0.4% and Germany's Dax was up 0.6%. Britain's FTSE 100 lagged, down 0.9%.
European stocks had opened even higher but pared gains after the German government revised down its GDP forecast for 2021.
PMI data from across Europe showed manufacturing activity generally on the path to recovery though factory managers are wary about investing and hiring more workers.
In Germany, Europe's largest economy, output grew at its fastest pace since February 2018, while in France it contracted.
The eurozone economy has experienced a strong recovery in the third quarter even though the most recent incoming data have been less robust, European Central Bank vice-president Luis de Guindos said.
The euro rose to a two-year high of $1.19975 at 3.24am GMT. At 8am GMT it was at $1.199, up 0.4% since New York's close, as a dollar sell-off continued.
Versus a basket of currencies the dollar was down 0.4% at 91.8811 at 8.10am GMT, dropping below 92 for the first time since May 2018.
Investors are betting on US rates staying lower for longer after Federal Reserve chair Jerome Powell on Thursday outlined an accommodative shift in the central bank's approach to inflation.
Eurozone inflation data for August was due this morning and was expected to show a decline to 0.2%, according to a Reuters poll.
Commerzbank analyst Esther Reichelt said inflation data highlights the difference between the Fed and the ECB.
“Whereas the market considers the Fed capable of rekindling inflation rates by leaving interest rates lower for longer than previously assumed, this does no longer seem to be the case as far as the ECB is concerned,” she wrote in a note to clients.
“Inflation data for August published today ...