Europe open: Apple, Scatec, IAG results boost sentiment

European shares opened higher on Friday as better-than-expected results from tech giant Apple boosted sentiment, despite lingering fears over the stability of the US banking system.

The pan-regional Stoxx 600 index rose 0.32% in early deals with all major bourses higher and US futures indicating a positive start to the final session of the week.

Apple surprised markets with an unexpected rise in iPhone sales amid a global slump in smartphone purchases as consumers start to retrench spending on big-ticket tech items.

Eyes will also be on US labour market data, with non-farm payrolls expected to have increased by 180,000 last month, the smallest increase in nearly 2-1/2 years, although wage growth is expected to have remained strong.

In economic news, German factory orders plunged in March, missing expectations and reversing previous gains.

According to the Federal Statistics Office, new orders in manufacturing fell 10.7% month-on-month, and by 11% on March 2022. That compares to a month-on-month increase of 4.5% in February. Analysts had been expecting a far more modest fall, of around 2.2%.

It was the strongest decline since April 2020, at the start of the pandemic.

Investors were also digesting the latest data out of China, showing growth in the services sector was a little weaker than expected in April.

The Caixin services purchasing managers’ index dipped to 56.4 from 57.8 in March, coming in below consensus expectations for a reading of 57.0. Still, it remained above the 50.0 mark that separates contraction from expansion for the fourth month in a row. It also marked the second-highest figure recorded since November 2020.

Wang Zhe, senior economist at Caixin Insight Group, said the reading indicates that services activity is still "undergoing a fast recovery".

On the equities front it was a much quieter day after a deluge of earnings reports and trading statements across the Continent.

Shares in British Airways owner IAG were higher as the company beat forecasts and lifted guidance after reporting a first-quarter operating profit in what is traditionally quiet period for airlines.

Norwegian renewable energy producer Scatec shares were 10% higher after strong results.

Reporting by Frank Prenesti for Sharecast.com