Europe open: Stocks waver after mixed Chinese data as investors eye ECB

European stocks wavered in early trade as investors digested some mixed Chinese data amid growing expectations that the European Central Bank will announce additional stimulus measures on Thursday.

At 0835 GMT, the benchmark Stoxx Europe 600 index was up 0.4%, while Germany’s DAX and France’s CAC were flat.

“This December will play host to two of the year’s most hotly anticipated announcements with Mario Draghi and Janet Yellen looking to set the tone for trading in 2016,” said Farbod Mimeh, a dealer at London Capital Group.

“Draghi and the ECB will have the first move on Thursday in what’s expected to be the unleashing of their €1.1 trillion QE scheme. Two week later will mark Janet Yellen’s most important FOMC as chair of the Federal Reserve and what could be the Fed's first rake hike in almost 10 years.”

Data released by the National Bureau of Statistics showed China’s manufacturing sector contracted for the fourth month in a row in November, falling to its lowest level in more than three years.

The official purchasing managers’ index slipped to 49.6, marking its lowest level since August 2012 and falling short of expectations for a reading of 49.8.

It was a brighter picture in terms of non-manufacturing, however, with the services PMI coming in t at 53.6 from 53.1 in October.

The Caixin manufacturing PMI, which focuses on small enterprises and has a smaller sample than the official numbers, was also more upbeat.

It rose to 48.6 in November from 48.3m the previous month, compared with expectations for a reading of 48.3.

“Despite data from China showing their economic output is still shrinking, there is growing belief that a turnaround is on the cards and we are seeing some follow-through positivity hitting European markets in early trade,” said Mike McCudden, head of derivatives at Interactive Investor.

On the corporate front, banks gained ground in London after it emerged that all seven of the UK’s largest banks passed stress tests by the Bank of England.

Lloyds, Barclays and Royal Bank of Scotland were the standout gainers on the FTSE 100, with Standard Chartered and HSBC following close behind.

French hotel group Accor was higher after saying it acquired three hotel asset portfolios from European investors for €284m.

On the downside, industrial gases company Linde tumbled after cutting its 2017 profit target.

Zurich Insurance was also on the back after it announced that its chief executive Martin Senn was stepping down.