Europe open: Mixed PMIs and weakness in overseas stocks drags

Stocks began the session on a slightly down note, tracking a mixed close overnight on Wall Street and weakness in some Asian markets.

A weaker-than-expected reading on the state of the euro area manufacturing and services sector was also acting as a drag on equities.

"A negative opening call for European equities comes a after a mixed stateside session, and slim gains in in Asia overnight. Investors may be sceptical of the latest oil price bounce, having been here several times lately but continually failing to overcome a downtrend channel amid global oversupply," said analysts Mike van Dulken and Henry Croft at Accendo Markets.

IHS Markit´s composite Eurozone manufacturing and services sector purchasing managers output index for June fell from 56.8 in May to 55.7 for June - a five-month low.

Weakness was centred on services, with the composite output gauge for that sector retreating from 56.3 to 54.7.

Economists had forecast a print of 56.6.

Nonetheless, for IHS Markit's chief business economist, Chris Williamson, June's figures should to be interpreted in the context of recent elevated readings.

"Despite the June dip, the average expansion in the second quarter has been the strongest for over six years and is historically consistent with GDP growth accelerating from 0.6% in the first quarter to 0.7%," he said.

French gross domestic product sped ahead at a 0.5% quarter-on-quarter clip, the same as over the previous three months (consensus: 0.4%).

Still on the European economic calendar for Friday, the Belgian central bank was set to publish its business confidence gauge for June at 1200 BST.

Scheduled for release later in the session, IHS Markit was also due to release its US factory sector PMI for June at 1445 BST, followed by new home sales data from the Commerce Department at 1500 BST.

Following that, the presidents of the St.Louis Fed, James Bullard, and Cleveland Fed chief Loretta Mester were expected to take to the podium in the afternoon.

On the corporate front, Sueddeutsche Zeitung reported that Allianz was planning to cut 700 jobs in Germany over the next three years.

According to Italian daily Il Messaggero, the European Commission granted an informal green light to the rescue of Banca Popolare di Vicenza and Veneto Banca.