European shares and the euro edged up and growth-sensitive commodities firmed on Friday, after a pick-up in China’s manufacturing sector lifted sentiment ahead of closely-watched European data.
Europe will get the first reading of Purchasing Manager Index manufacturing data just before 0900 GMT with investors hoping to see signs the region’s struggling economy is readying for a pick-up.
After more than eight hours of late-night talks at a summit in Brussels, EU leaders also provided a fillip for markets, promising to push ahead with a pan-euro zone mechanism to wind down problem banks.
European shares opened 0.1 percent higher, pushing back towards an 18-month high. London’s FTSE 100 , Paris’s CAC-40 and Frankfurt’s DAX climbing between 0.1 and 0.3 percent.
“Every minor dip is bought up pretty quickly afterwards,” said Central Markets senior broker Joe Neighbour. “I can’t really see any big sell-off between now and the end of the year. I expect the markets to continue to grind higher.”
Following a mixed session for Asian equities, the early European rises left the MSCI index of global stocks just above flat at 331 points, adding to a 6 percent rise over the last three weeks.
In the currency market, the brighter mood in the region helped the euro remain above $1.31 near a nine-day high. Dovetailing the move, demand for German government bonds dipped and oil and copper prices edged higher.
A deteriorating business sentiment survey and expectations that the Bank of Japan will ease policy further to support the weak economy next week pushed the yen to a near 9-month low against the dollar and an 8-month low against the euro, however.
China shares outperformed Asian peers after the HSBC flash purchasing managers’ index for December hit a 14-month high of 50.9, the fifth straight monthly gain, underlining the world number two economy’s improving growth prospects.
