Europe’s main stock markets mostly fell yesterday on downbeat Chinese data, and despite news that the eurozone economy grew more than anticipated in the first quarter.
Sentiment was rocked by news of a below-forecast reading on factory activity in China.
The European single currency edged upwards but most markets were also preoccupied with disappointing US technology results including Google-parent Alphabet.
Activity in China’s factories barely grew last month, indicating the world's number two economy continues to struggle. The reading comes after a surprise jump last month that had fuelled hopes of stabilisation.
The news weighed in Asia alongside poor tech sector earnings, although Shanghai rose as in-vestors fished for bargain shares.
“Today’s latest macro data has painted a mixed picture about the health of the global economy, causing (most) stocks to fall in Asia overnight with Europe also starting on the back foot,” said Forex.com analyst Fawad Razaqzada.
“It comes after the latest Purchasing Managers’ Indices (PMIs) from China’s manufacturing and services sectors disappointed expectations, casting fresh doubts over the world’s second largest economy.
“However, there was some positive news out of the eurozone, where the economy expanded at a slightly faster pace than expected.”
In afternoon deals, London stocks were down 0.4 per cent. Elsewhere, Paris shed 0.4 per cent and Frankfurt slid 0.2 per cent.
Milan’s stock market however gained 0.2 per cent on welcome news that Italy has emerged from recession. The overall eurozone economy expanded by a better than forecast 0.4 per cent in the first quarter, official data showed, dampening talk of a looming recession in Europe.
The figure exceeded the expectations of analysts interviewed by data company Factset that forecast 0.3 per cent growth.
In Asia, tech firms also took a hit as two of the biggest names in the sector posted disappointing earnings, dampening sentiment on markets in the region.
Alphabet reported a 29 per cent drop in quarterly earnings on slower-than-expected revenue growth after US markets closed. Google shares fell around 8 per cent when trading started in New York.
Meanwhile smartphone and chip titan Samsung Electronics said its operating profit plunged a worse-than-expected 60.2 per cent in January-March as sales also tumbled.
The release of Apple’s results will be nervously watched by the market with some observers suggesting a weak reading could spark more heavy selling.
Yesterday, the Dow edged up 0.2 per cent in opening trading, but the tech-heavy Nasdaq slid 0.7 per cent.