European stocks rose Wednesday, tracking gains in Asia, on the
back of some robust data on China's services sector.
In early trade, the Stoxx Europe 600 rose 0.5%, having fallen
slightly in the previous session as a result of lackluster
corporate earnings.
In Asia on Wednesday, Japan's Nikkei Stock Average rose 0.5% and
South Korea's Kospi gained 0.3%.
The closely watched Caixin Services Purchasing Managers' Index
climbed to an 11-month high in July despite a steep selloff in
China's stock market, data showed Wednesday.
The services PMI rose to 53.8 for the month, up sharply from
51.8 in June. A reading above 50 indicates expansion from the
previous month; below 50, contraction.
One of the biggest gainers on the pan-European index was Socié
té Gé né rale SA. Shares in the French bank added nearly 7% shortly
after the market opened.
The lender said Wednesday that second-quarter net profit jumped
25%, lifted by the performance of its large equity and derivatives
trading business and a debt-valuation adjustment.
In currency markets, the euro was 0.2% lower against the dollar
in early European trade at $1.087.
The buck rose against both the euro and the yen late Tuesday
after Federal Reserve Bank of Atlanta President Dennis Lockhart,
who is a voting member on the Fed's monetary-policy committee,
raised expectations for an interest rate rise as early as
September.
Deutsche Bank strategist Jim Reid wrote in a note to clients
that this shows the Fed's plans for an increase in rates have
seemingly not been derailed by the recent commodity rout, concerns
over China, "and the general disappointments over the state of the
wider global recovery."
Later in the day, investors will be paying close attention to
the release of the latest estimate of the increase in private
payrolls compiled by payroll processor Automatic Data Processing
Inc. and forecasting firm Moody's Analytics. This will come out
ahead of the Bureau of Labor Statistics' employment situation
report scheduled for Friday.
Valentin Marinov, a currency strategist at Cré dit Agricole said
that a strong reading would likely trigger a fresh rally in the
dollar, especially against Japan's yen, the Canadian dollar, the
euro and the Swiss franc.
Brent crude was 0.9% higher in early trade at $50.44 per barrel.
Gold was 0.3% lower at $1,087.00 per barrel.
Write to Josie Cox at josie.cox@wsj.com
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