European Markets Mostly Finished Lower Despite Strong PMI Data

(RTTNews) - The majority of the European markets ended Thursday's session in the red. Solid service sector data from both China and Europe was unable to override investor concerns over the partial shutdown of the U.S. government. The U.S. shutdown entered its third day Thursday with Democrats and Republicans still at odds over a budget despite a meeting late yesterday between President Obama and top Congressional leaders.

The growth in Chinese non-manufacturing sector reached a six-month high in September amid a solid increase in new work, a survey by the China Federation of Logistics and Purchasing, or CFLP, and the National Bureau of Statistics revealed Thursday.

The headline purchasing managers' index for the non-manufacturing sector, which includes services and construction industries, rose to a six-month high of 55.4 in September from 53.9 in August.

The ongoing strength of the British private sector, as indicated by the latest purchasing managers' surveys, points to a sharp pick-up in GDP growth in the third quarter, Capital Economics Chief UK Economist Vicky Redwood said Thursday.

Capital Economics forecasts that economic growth in the third quarter would comfortably match or exceeded the 0.7 percent growth recorded in the second quarter.

The Euro Stoxx 50 index of eurozone bluechip stocks declined by 0.58 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, lost 0.41 percent.

The DAX of Germany dropped by 0.37 percent and the CAC 40 of France fell by 0.73 percent. The SMI of Switzerland decreased by 0.28 percent, but the FTSE 100 of the U.K. rose by 0.18 percent.

In Frankfurt, Commerzbank declined by 2.09 percent while Deutsche Bank fell by 0.22 percent.

Gerresheimer dropped by 2.03 percent, after Credit Suisse downgraded the stock to ''Neutral'' from ''Outperform.''

In Paris, Schneider Electric declined by 3.17 percent. Exane BNP downgraded its rating on the stock to "Neutral" from "Outperform."

Kering fell by 0.88 percent, after Deutsche Bank downgraded the rating on the stock to ''Hold'' from ''Buy.''

In London, Tesco advanced by 1.96 percent. Citigroup upgraded the stock to ''Neutral'' from ''Sell.''

SABMiller dropped by 1.48 percent, after Credit Suisse downgraded it to "Neutral" from "Outperform."

Goldman Sachs removed Unilever from its ''Conviction Buy'' List. The stock climbed by 2.07 percent.

Aviva gained 1.37 percent, after it announced that it received more money from the sale of its U.S. life and annuities business than it had initially estimated.

Vodafone rose by 1.39 percent after it announced that Nick read will become its new CFO, after Andy Halford departs at the end of March.

BP advanced by 1.12 percent. A U.S. appeals court ordered a lower court judge to halt some payments to businesses that suffered damage from the 2010 oil spill in the Gulf of Mexico.

Low-cost airline easyJet lifted its outlook for full-year pre-tax profit, on strong demand in July and August. The stock finished lower by 0.46 percent.

Biotechnology firm Addex surged by 5.83 percent in Zurich. The company said its ADX71441 dose dependently reduced PMP22 expression, comparable to baclofen in a preclinical transgenic model of Charcot-Marie-Tooth 1A disease or CMT1A.

Private sector business activity across the Eurozone improved slightly more than previously estimated in September, final results of a survey by Markit Economics revealed Thursday. The composite output index, that measures performance of both manufacturing and service sectors, rose to a 27-month high of 52.2 in September from 51.5 in August. The flash estimate was 52.1.

Eurozone's retail sales increased more than expected in August on a rebound in non-food product turnover, the latest figures from Eurostat revealed Thursday. Retail sales increased 0.7 percent month-on-month in August compared with forecast for a 0.2 percent growth. Moreover, the rate exceeded July's 0.5 percent rise.

Germany's service sector activity increased at the fastest pace in seven months in September, but to a lesser extent than estimated earlier, final data from a survey by Markit Economics and BME showed Thursday.

The seasonally adjusted purchasing managers' index (PMI) for the service sector advanced to 53.7 in September from 52.8 in August, hitting the highest level since February. Initially, the index for September was estimated to rise to 54.4.

The French private sector expanded slightly more than initially estimated in September, ending an 18-month period of decline, survey data from Markit Economics showed Thursday. The seasonally adjusted final Markit composite output index rose to 50.5, a 20-month high, from 48.8 in August. The preliminary reading was 50.2.

The U.K. service sector continued to perform strongly in September and thereby round off the best quarterly performance of the sector since the second quarter of 1997, data from Markit Economics showed Thursday. The headline Markit/Chartered Institute of Purchasing & Supply Purchasing Managers' Index dropped slightly to 60.3 in September from August's near seven-year high of 60.5.

U.K. house prices increased for the eighth consecutive month in September as housing demand has risen more quickly than supply, survey data from Lloyds Banking Group's Halifax division showed Thursday. House prices were up 0.3 percent month-on-month in September, the same rate of growth as seen in August.

First-time claims for U.S. unemployment benefits showed a modest increase in the week ended September 28th, according to a report released by the Labor Department on Thursday. The report said initial jobless claims inched up to 308,000, an increase of 1,000 from the previous week's revised figure of 307,000.

Economists had been expecting initial jobless claims to climb to 315,000 from the 305,000 originally reported for the previous week.

Activity in the U.S. service sector continued to grow in the month of September, according to a report released by the Institute for Supply Management on Thursday, although the pace of growth slowed by even more than economists had anticipated.

The ISM said its non-manufacturing index dropped to 54.4 in September from 58.6 in August. While a reading above 50 indicates continued growth in the service sector, economists had expected the index to show a much more modest decrease to a reading of 57.0.