European Markets Pulled Back On China Concerns

By RTT News, 
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(RTTNews.com) - The European markets ended the first day of the new trading week in negative territory. Investor sentiment was impacted by the drop in Chinese non-manufacturing data, which signaled that the economy is slowing amid Beijing's efforts to push through the planned reforms. The Chinese data overshadowed the Eurozone manufacturing data, which moved back into expansion territory.

An indicator of Chinese non-manufacturing sector activity declined in January, in another sign that the economy is slowing amid Beijing's efforts to push through the planned reforms. The non-manufacturing purchasing managers' index declined to 53.4 in January from 54.6 in December, the results of a survey by the China Federation of Logistics and Purchasing (CFLP) and the National Bureau of Statistics showed Monday.

The Euro Stoxx 50 index of eurozone bluechip stocks declined by 1.63 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, lost 1.56 percent.

The DAX of Germany dropped by 1.29 percent and the CAC 40 of France tumbled by 1.39 percent. The FTSE 100 of the U.K. decreased by 1.11 percent and the SMI of Switzerland fell by 1.03 percent.

In Frankfurt, RTL Group declined by 2.62 percent. Goldman Sachs downgraded the stock to ''Neutral'' from ''Buy.''

Hawesko dipped 0.20 percent. The stock was downgraded to ''Hold'' from ''Add'' at Commerzbank.

Evonik rose by 0.70 percent, after Exane BNP started the stock with an ''Outperform'' rating.

In London, Lloyds Banking Group dropped by 3.97 percent. The lender said it has made a further provision of 1.8 billion pounds for legacy PPI business. Barclays lost 2.50 percent and Royal Bank of Scotland sank by 1.97 percent.

ARM Holdings decreased by 0.53 percent. Deutsche Bank downgraded the stock to ''Hold'' from ''Buy.''

Smith & Nephew advanced by 1.14 percent, after it agreed to buy US-based Arthrocare.

Ryanair, which reported financial results, increased by 6.81 percent. RM, which proposed a special dividend, surged by 14.60 percent.

Julius Baer tumbled by 5.93 percent in Zurich. The private banking group said it expects to achieve the asset transfer target from the integration of Merrill Lynch's International Wealth Management to be towards the lower end of the 57 billion francs to 72 billion francs range.

The Eurozone manufacturing sector grew slightly more than initially expected in January, Markit Economics showed Monday.

The final results of Purchasing Managers' survey revealed that the manufacturing activity grew at the strongest rate since May 2011. The headline PMI has risen in each of the past four months and has signaled growth since July last year.

The PMI rose to 54 in January, above the flash estimate of 53.9, from December's score of 52.7. The expansion led by Germany, and the Greek PMI moves back into expansion territory.

German manufacturing sector growth rose to its strongest in thirty-two months in January, a survey by Markit Economics showed Monday. The headline Markit/BME purchasing managers' index rose to a 32-month high of 56.5 in January from 54.3 in December. The flash result showed a reading of 56.3.

French manufacturing sector contracted less than initially estimated in January, final results of a survey by Markit Economics showed Monday. The final purchasing managers' index rose to a four-month high of 49.3 in January from 47 in December. The flash survey results published last month showed a reading of 48.8 for January.

The U.K. manufacturing sector continued to expand in January, reflecting improvement in output and new orders, survey data from Markit Economics showed Monday.

The seasonally adjusted Markit/Chartered Institute of Purchasing & Supply Purchasing Managers' Index fell more-than-expected to 56.7 in January from 57.2 in December. Economists had forecast the reading to fall to 57.1 from December's originally estimate score of 57.3.

The average asking prices for a house in the United Kingdom was up 0.3 percent in January compared to the previous month, property tracking website Hometrack said on Monday in its monthly survey. That's slower than the 0.5 percent monthly increase in December, although it represented an expansion for the 12th consecutive month.

While the Institute for Supply Management released a report on Monday showing modest growth in U.S. manufacturing activity in the month of January, the pace of growth slowed much more than economists had been anticipating.

The ISM said its purchasing managers index fell to 51.3 in January from a revised 56.5 in December. A reading above 50 indicates continued growth in the manufacturing sector, but economists had expected the index to show a much more modest decrease to a reading of 56.0.

Construction spending in the U.S. showed a slight increase in the month of December, according to a report released by the Commerce Department on Monday, with an increase in spending on private construction more than offsetting a drop in spending on public construction.

The report said construction spending inched up by 0.1 percent to an annual rate of $930.5 billion in December from the revised November estimate of $929.9 billion. Economists had expected spending to come in unchanged compared to the previous month.

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