European Markets Rise as Spanish Stocks Fall Amid Political Tumour

By Investors Hub

European markets were mostly higher on Monday even as Spanish stocks fell amid a political crisis after Catalans voted in favour of independence in a contested referendum, plunging the EU into a new crisis.

The euro moved lower against the dollar after the violence-marred independence vote in Spain’s Catalonia region.

The pan-European Stoxx Europe 600 index was up 0.3 percent at 389.27 in late opening deals, with upbeat data from China, Japan and the euro zone supporting underlying sentiment.

Official data released over the weekend showed activity in China’s vast manufacturing sector grew at the fastest pace since 2012 in September, helping ease growth worries ahead of an upcoming political meeting next month.

Separately, Tankan survey results showed that Japanese business confidence among large manufacturers improved in the third quarter to the highest in a decade.

Closer home, final data from IHS Markit showed today that the euro area manufacturing sector grew the most in over six-and-a-half years in September.

The final manufacturing PMI climbed to a 79-month high of 58.1 from 57.4 in August, suggesting expansion for the fifty-first month in a row.

Investors shrugged off data from IHS Markit, which showed that the U.K. manufacturing sector continued to expand in September, albeit at a slower pace compared to August.

The German DAX was up 0.3 percent and France’s CAC 40 was marginally higher, while the U.K.’s FTSE 100 was up as much as 0.6 percent, led by housebuilders and airline stocks. Spain’s IBEX was tumbling 1.4 percent, dragged down by banks with CaixaBank and Sabadell losing 4-6 percent.

Miners Antofagasta, Anglo American, Glencore, BHP Billiton and Rio Tinto gained 1-2 percent as copper futures edged up after upbeat economic data from China and Japan.

Shares of easyJet rallied 4.2 percent, Ryanair Holdings jumped 2.5 percent and Lufthansa climbed 3.2 percent after Monarch Airlines had been placed into administration.

British housebuilder Barratt Developments advanced 3.6 percent on expectations that the government will extend the ‘Help to Buy’ scheme to stimulate the demand side of the housing market.

French ballpoint pens and razors maker BIC slumped 9.3 percent after cutting its 2017 sales forecast.

Building materials group CRH lost over 1 percent on a Bloomberg report that it is nearing an agreement to acquire Florida-based cement company Suwannee American Cement LLC from Votorantim Cimentos SA and Anderson Columbia Co.

Daily Mail and General Trust declined 2 percent. The newspapers publisher expects its full-year pretax profit to be at the lower end of market expectations.