Europe open: Stocks inch higher as PMIs revised up
European stock markets inched higher in early deals on Monday as investors digested a wave of better-than-expected PMI survey and looked ahead to a busy week of headline-grabbing macro data.
By 0939 CEST, the Stoxx 60 was up just 0.1% at 508.67 with small losses in London and Madrid outweighed by moderate gains in Frankfurt, Paris and Milan.
Supporting stocks early on was the news of a meeting between Italian prime minster Georgia Meloni and US president-elect Donald Trump, lifting hopes that an improved relationship between the two nations could "help insulate Italy from the worst of the tariff threats and could provide a cushion of support for the wider EU", according to Susannah Streeter, head of money and markets at Hargreaves Lansdown.
"Her show of influence may add a little sheen of optimism to trading in Europe, with Italy’s FTSE MIB, the CAC 40 and the DAX expected to be positive in early dealing," Streeter said ahead of the opening bell.
"The Italian Prime Minister’s surprise visit to the incoming President’s Mar-a-Lago resort in Florida was aimed at progressing talks on a raft of issues, with trade looking high on the agenda. Thanks to her blossoming friendship with both Trump and Elon Musk, Ms Meloni is shaping up to be a vital navigator to help steer EU nations through the fog of uncertainty."
Economic data barrage
In economic data, private-sector activity in the eurozone eased slightly less than originally reported in December, as the Hamburg Commercial Bank revised higher its purchasing managers' index for single-currency region. The final estimate for the composite PMI for the eurozone was lifted by 0.1 points to 49.6, up from 48.3 in November, due to stronger-than-expected growth in the services sector.
Service-sector PMIs from Germany, France, Italy and Spain were also revised higher for December, according to HCOB. Notably, growth in the Spanish services industry reached a 20-month high.
Later in the session, markets will get their first look at German inflation data for December and the Sentix investor confidence survey in the eurozone, along with revisions to the S&P Global PMI for the UK and US.
Looking ahead, this week will also see the release of eurozone-wide inflation figures for December and crucial labour-market indicators from the US for last month.
Market movers
Luxury stocks were mostly higher early on, including Italian brands Brunello Cucinelli, Salvatore Ferragamo and Moncler, and French names LVMH and Christian Dior, on the back of the weekend meeting between Meloni and Trump.
"There will be hopes the impact [from Trump's trade tariffs] on the luxury goods sector will be more minimal thanks to these rounds of glad-handing," Streeter said.
Tech stocks were also performing well, following on from a surge by US-listed tech counterparts on Friday – the Nasdaq jumped 1.8% on the day – with European names like ASML Holding, Infineon Technologies and STMicroelectronics among the best performers on the Stoxx 600.