Europe close: Stocks mostly higher as bonds steady, oil dips

(Sharecast News) - European markets were mostly higher on Thursday, following strong gains on Wall Street and Asian indices overnight, as bond yields retreated from their recent highs.

"The pullback in yields from yesterday's highs could also be a consequence of the sharp fall we've seen in energy prices, and the worst one-day fall in oil prices since September last year, which took them back to levels last seen at the end of August and wiped out all of September's gains in the space of 4-days," said Michael Hewson, chief market analyst at CMC Markets UK.

The Stoxx 600 index edged up 0.28% to 441.31.

Most of the main regional indices were a tad higher alongside save for the German Dax which was off by 0.2% to 15,070.22.

The Stoxx 600 index has fallen for seven out of the past ten trading sessions, dropping 4.2% during that period.

Front dated Brent was off by 1.19% to $84.62 a barrel on the ICE.

German, Italian and Spanish 10-year government bond yields were all down slightly.

Worth noting, investors were expectant ahead of the release of the monthly U.S. non-farm payrolls data the next day, which might decide whether the selling pressure on bonds abated or not in the very near term.

In European economic data on Thursday, the HCOB Eurozone construction purchasing managers' index pointed to a further marked deterioration at the end of the third quarter, with new business sales dropping to their lowest level since May 2020. The PMI rose slightly to 43.6 in September from 43.4 in August but remained firmly in negative territory (ie under 50).

French industrial output declined by 0.3% in August after a revised -0.5% in July, but the decline in Spanish industrial output worsened to 0.8% from a revised +0.1% in July.

Meanwhile, the German trade surplus fell to €16.6bn in August, down from a revised €17.7bn in July but above the €15bn forecast.

In stock movements, shares in Pandora surged 12% in Copenhagen after the Danish jewellery group said it expects organic growth of 7-9% from 2023 to 2026.