Europe midday: Stocks continue to rally as manufacturing PMIs beat forecasts

(Sharecast News) - A raft of better-than-expected manufacturing data lifted European stocks on Friday with the Stoxx 600 index trading at its highest levels in four months. The pan-European index was up 0.5% at 463.93 by midday CET, with every major index across the continent putting in gains of between 0.4% and 0.7%. The Stoxx 600 hasn't closed above this level since 10 August, having gained over 7% in November alone.

Stocks were extending gains made on Thursday after data revealed that inflation had slowed more than expected in both the US and eurozone, raising hopes that policymakers will move to cut interest rates sooner than initially predicted.

"Markets have been reminded how close we are to a dovish pivot from the likes of the ECB and FOMC," said analyst Joshua Mahony from Scope Markets.

Helping sentiment on Friday morning were manufacturing purchasing managers' indices (PMIs) from China, UK and the eurozone, which all beat expectations.

The Caixin/S&P Global China manufacturing PMI rose to 50.7 in November from 49.5 in October. This was above the 50.0 level that separates contraction from expansion and marked the fastest expansion in three months, beating the 49.8 consensus estimate.

The final reading of the S&P Global/CIPS UK manufacturing PMI rose to 47.2 from 44.8 in October, ahead of the consensus and flash estimate of 46.7. This marked the third monthly increase in a row and the highest level since April.

Meanwhile, the S&P Global/HCOB eurozone manufacturing PMI was revised up to 44.2 last month from an initial estimate of 43.8. This was a six-month high and up from 43.1 in October.

Viaplay tanks

Swedish streaming company Viaplay saw shares drop as much as 80% in Stockholm after announcing plans to raise SEK4bn (£300m) and restructure its debt totalling SEK14.6bn, saying it had to lay off more than 30% of staff. "This extensive package and operational measures are absolutely necessary to secure the survival of the company," said chair Simon Duffy.

Worldline, the payment services firm, was rallying 9% on reports that lender Credit Agricole could build a stake in the French company.

Mining stocks were performing well in London, with Anglo American, Rio Tinto and Antofagasta among the top risers on the Stoxx 600 after improving economic data from China lifted the demand outlook.