Europe open: Markets higher after Xi's trade optimism, PMIs in focus

European stocks were higher on Friday morning as investors' trade war worries were alleviated by comments from Chinese President Xi Jinping.

At 0905 GMT, the Stoxx 600 was up by 0.8% at 405.32, as Germany's Dax rose by 0.8% to 13,237.93 and the French CAC 40 climbed by 0.8% to 5,928.30. Meanwhile, London's FTSE 100 was 1.2% higher at 7,323.21.

Xi said he wanted to reach an initial trade agreement with Washington on the basis of mutual respect and equality, adding that Beijing was "working actively to try not to have a trade war".

Spreadex analyst Connor Campbell said: "A convincing case could be made for this being completely meaningless. Yet given investors are devouring every morsel of trade deal news, it was enough to send the markets back into the green."

On the data front, the eurozone IHS Markit flash composite purchasing managers' index (PMI) came in at 50.3 for November, dropping from October's 50.6 and also falling short of consensus expectations for a reading of 50.9.

Germany's composite PMI climbed to 49.2 but this was below consensus estimates for a reading of 49.4, while French business activity also enjoyed a slight expansion.

IHS Markit economist Chris Williamson said: "Tentative signs of life in the core eurozone countries of France and Germany are welcome news, as is an easing in the manufacturing downturn, but a fresh concern is that the rest of the region has slipped into decline for the first time since 2013.

"Business remains concerned by trade wars, Brexit and a general slowdown in demand, with heightened uncertainty about the economic and political outlook driving further risk aversion."

In corporate news, French payment solutions giant Edenred slid after it said that malware had infected a number of its computer systems, with customers finding themselves blocked out of its online services.

German engineering firm Thyssenkrupp was in the green, staging a slight recovery following a tumble on Thursday after it scrapped its dividend and announced a widened full-year net loss.