Upbeat European figures give markets a lift

Surprisingly strong European economic figures shore up markets despite China concerns

Associated Press
Asian shares little changed ahead of earnings
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A man walks by an electronic stock board of a securities firm in Tokyo, Wednesday, July 24, 2013. Asian stock markets were mostly lower Wednesday after a survey showed Chinese manufacturing activity fell to its lowest point in nearly a year. Japan's Nikkei 225 fell 0.6 percent to 14,692.83. (AP Photo/Itsuo Inouye)

LONDON (AP) -- Surprisingly strong economic figures out of Europe and upbeat earnings from Apple helped shore up markets Wednesday despite earlier concerns over China.

Financial information company Markit said its monthly purchasing managers' index — a broad gauge of economic activity — for the 17-country eurozone rose for the fourth month running, to 50.4 points in July from 48.7 the previous month.

The increase, which was larger than anticipated, suggests the eurozone economy is growing again — anything above 50 indicates an expansion. Hopes have grown of late that official figures next month may show that the eurozone's recession, which started in late 2011, may have come to an end in the second quarter.

"Yesterday's weakness and indecision in the markets, prompted by a general dearth of major news, has been banished as investors look to some surprisingly positive data from the eurozone," said Yusuf Heusen, a sales trader at IG.

"Market-moving economic data has been absent so far this week, so today's figures have been gratefully received by a market that, the occasional stop-hunt aside, is still casting around for reasons to move higher," Heusen added.

In Europe, Germany's DAX was up 0.9 percent at 8,392 while the CAC-40 in France rose 1.2 percent to 3,971. The FTSE 100 index of leading British shares was up 0.6 percent at 6,637. The PMI survey did little for the euro though, which was trading flat, but near recent highs, at $1.3220.

In the U.S., the Dow Jones industrial average was up 0.1 percent at 15,583 while the broader S&P 500 index rose 0.2 percent to 1,695.

The latest run of U.S. corporate earnings statements did little to alter the market mood. Though earnings from Boeing and Ford were better than expected, Caterpillar disappointed.

The big mover was Apple, which saw its share price rise nearly 5 percent following its after-hours statement on Tuesday that sales of iPhones helped quarterly profits rise by more than expected in the markets.

"Last night's numbers from Apple were also a welcome respite for the tech sector which has struggled in the current earnings season," said Andy McLevey, head of dealing at Interactive Investor.

Earlier during the Asian session, Chinese shares were in focus after a survey showed the country's manufacturing fell to its lowest point in nearly a year. HSBC said its preliminary estimate for its purchasing managers' index for July declined more than expected to an 11-month low, another sign of a deepening economic slowdown.

The widely watched report is one of the earliest indicators on the health of China's economy, the world's second biggest. Analysts say the findings pave the way for more disappointment.

The Shanghai Composite Index in mainland China closed 0.5 percent lower at 2,033.33 after falling as much as 1.3 percent.

Elsewhere in Asia, Japan's Nikkei 225 dropped 0.3 percent to 14,731.28. Other indexes reversed earlier losses to finish in positive territory. Hong Kong's Hang Seng gained 0.2 percent to 21,968.93 and South Korea's Kospi rose 0.4 percent to 1,912.

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