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StockBeat: Stoxx 600 Prepares for Another Run at 400

By Geoffrey Smith

Investing.com -- Europe’s stock markets were broadly higher after early trade on Friday after a strong manufacturing survey from China supported hopes that the worst of that country’s slowdown is over.

The moves largely corrected losses from earlier in the week and still weren’t enough to get markets like the U.K.'s FTSE 100 or Spain’s IBEX 35 over the gain line for the week, and few were willing to place large new bets ahead of the U.S. labor market report later in the day.

The report will be the first major hard data of the fourth quarter, following on from a mixed bunch of purchasing manager surveys from research firm IHSMarkit this week. Much of Friday’s gains in Europe were due to the big improvement in the IHS/Caixin manufacturing PMI in China, which showed its biggest improvement in two years. Reports from European markets were not as strong, with Turkey, the Netherlands, Sweden and Norway all falling, and only Switzerland and the U.K. surprising significantly to the upside.

Among sectors, chipmakers made solid gains on the back of Samsung’s forecast that the memory chip sector will revive strongly next year after a buffeting this year from the U.S.-China trade dispute.

STMicroelectronics NV (PA:STM) was up 1.6%, while ASML (AS:ASML) and Infineon Technologies (DE:IFXGn) were both up 1.3%. AMS (SIX:AMS), more concerned with the outcome of its struggle for control of Osram Licht (DE:OSRn), was unchanged.

Elsewhere, Danske Bank (CSE:DANSKE) was the standout underperformer after it lowered its full-year guidance under the impact of low interest rates and costs from its Russian money-laundering scandal.

Peugeot (PA:PEUP) and components maker Faurecia (PA:EPED) both recovered, meanwhile, after Thursday’s steep declines in response to the terms of its agreed merger with Fiat Chrysler (MI:FCHA). Peugeot was up 1.9% while Faurecia was up 1.4%

By 5:30 AM ET (0930 GMT), the benchmark Euro Stoxx 600 was up 0.4% at 398.50, set for yet another run at the 400 level if the employment report can give it fuel. The German DAX was also up 0.4%, while Copenhagen led the way with a 1.3% gain.

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