Europe close: Stocks bounce back amid more positive trade headlines
European stocks bounced back on Wednesday, as reports suggested Sino-US trade negotiations were making progress and investors digested data from China and the Eurozone.
"It is still too early to declare the great market correction of December 2019 over, but if it is it will mark a triumph for this ongoing bull market and an indication of more to come as December grinds on towards Christmas," said IG chief market analyst Chris Beauchamp.
By the end of trading, the Stoxx 600 was 1.18% higher at 403.19, as Germany's DAX climbed by 1.16% to 13,140.57 and the French CAC 40 jumped by 1.27% to 5,799.68. Meanwhile, London's FTSE 100 was up by 0.42% at 7,188.50.
Citing sources familiar with negotiations, Bloomberg reported that Washington and Beijing were closing in on a phase-one deal despite tensions over Hong Kong and Xinjiang.
This news appeared to contradict comments made by US President Donald Trump in London just the day before, which had sparked fears that a deal might not be reached until November 2020, after the next US presidential contest.
In the background, investors were also digesting data from Asia published overnight.
China's unofficial Caixin services purchasing managers’ index (PMI) climbed to 53.5 in November from 51.1 the month before, beating an anticipated reading of 51.2 and marking the fastest expansion since April.
Zhong Zhengsheng, director of macroeconomic analysis at Caixin Global affiliate CEBM Group, said: "China’s economy continued to recover in November, as domestic and foreign demand both improved. But business confidence remained subdued, reflecting the impact from uncertainties generated by the China-US trade conflicts. That will restrain a recovery in economic growth."
Meanwhile, IHS Markit's composite Eurozone Purchasing managers' Index, which covers both the factory and services sectors, beat a 'flash' or preliminary estimate of 50.3, which was unchanged from October, inching upwards to 50.6 in November.
Pantheon Macroeconomics analyst Claus Vistesen said: "In short, EZ PMI data are mixed, but remain soft overall. Output growth in services was once again the key driver of overall activity, though the pace slowed a bit, while the rate of contraction in manufacturing easing.
"New orders to the private sector as a whole were unchanged on the month, reversing declines in the two past months, with demand in the domestic economy offsetting still-slowing external demand."
Among individual stocks, Airbus made gains after winning an order from US-based United Airlines for 50 new long-range passenger jets.
Swedish industrial group Trelleborg climbed after it announced plans to slimline its operations to three business areas as it launched a strategic review.
Infineon and STMicroelectronics both rose after a positive update from fellow chipmaker Microchip Technology.
Stock of Orange on the other hand was in the red after its dividend outlook failed to meet expectations, though the French telecoms operator also announced plans to organise its European mobile mast operations into a separate company.