Europe close: Slump in gas futures and economic data buoy stocks

European stocks reversed early losses spurred by Chinese foreign trade data that added to recessions woes, amid positive economic data and with the help of a tailwind from falling natural gas prices.

Helping to buttress investor sentiment, Eurotat revised its estimate for euro area gross domestic product growth in the second quarter from 0.6% quarter-on-quarter to 0.8% (consensus: 0.6%).

Furthermore, the rise in employment over the same stretch was now pegged at 0.4% on the quarter (Preliminary: 0.3%).

The benchmark Stoxx 600 index was down 0.57% at 41201, but Germany’s DAX added 0.35% to 12,915.97 while France’s CAC 40 rallied off the session lows to edged up by 0.02% to 412.01.

Dutch TTF natural gas futures meanwhile cratered by a further 32.2% to €207.7/Mwh.

Euro/dollar climbed alongside, adding 0.91% to stand at 0.9994.

Official customs data released overnight in China had shown that exports slowed markedly in August as global demand started to soften.

The trade balance was $79.39bn, compared to a record $101.26bn in July and a consensus forecast of $92.7bn.

Craig Botham, chief China+ economist at Pantheon Macroeconomics, said: "The weakness in imports, meanwhile, reflects the dire state of domestic demand, without which the trade surplus would be falling more rapidly.

"Export data by country reveals a broad-based slowdown in August - this was not driven by isolated pockets of demand weakness."

Investors were also mulling the latest comments from Russian president Vladimir Putin. According to reports, Putin has threatened to cut off energy supplies if price caps are imposed on Russia's oil and gas exports, warning the West that it would be "frozen" like a wolf's tail in a famous Russian fairy tale.

On the corporate front, Ubisoft tanked 17% after China’s Tencent increased its investment in the French video game company, dashing takeover hopes.

Spain’s Repsol was also in focus after agreeing to sell a 25% stake in its oil and gas exploration and production unit to US fund EIG for $4.8bn.