Europe open: Markets rise as auto stocks shine
European stocks were higher on Thursday morning as automotive stocks rose and European leaders pondered the length of a delay to the Brexit deadline.
At 0902 BST, the Stoxx 600 was 0.4% higher at 396.67, as Germany's Dax climbed by 0.7% to 12,881.72 and the French CAC 40 increased by 0.5% to 5,679.84. In London, the FTSE 100 was up by 0.7% at 7,312.51.
Daimler racked up strong gains after it reported 8% growth in third quarter revenue due to sales growth from Mercedes-Benz cars and vans, though the German automotive giant warned its full year earnings will fall below those of 2018 due to legal costs.
Even so, the news of strong third quarter sales sent fellow European car makers such as BMW, Peugeot and Renault higher.
In Brexit news, reports suggested that EU leaders have agreed to offer the UK a deadline extension beyond 31 October, though it may be shorter than European Council President Donald Tusk's plan for a delay until 31 January.
Oanda analyst Craig Erlam said: "Brexit limbo continues on Thursday as the UK awaits judgement from Brussels on its extension request, one week before the country is due to leave the European Union. The EU will be in no rush to make a decision and may even be awaiting more details on how Parliament intends to make use of the time before doing so.
"There's little chance of it rejecting the request but how long it offers needs to be determined."
In macroeconomic news, IHS Markit’s flash composite PMI for the eurozone came in at 50.2, above September six-year low reading of 50.1 but below expectations for 50.3.
This came as manufacturing PMI for the area failed to improve, holding steady at September’s reading of 45.7 and missing the median expectation for 46.0, though services data rose slightly to 51.8.
Analysts at Pantheon Macroeconomics said: "The details aren’t pretty. New orders and production fell in the private sector as a whole, driven by still-weak conditions in manufacturing. This trend pushed down work backlogs for the 11th month in a row. As a result, firms are also now slowing their intake of new workers.
"Overall job growth fell to its slowest pace so far in this expansion—which began in 2013—a trend driven primarily by an outright, and strong, decline in manufacturing employment."
Among individual stocks, Nokia dived after the Finnish telecoms business cut its guidance for 2019 and 2020 as it said it was facing pressure from competition in securing 5G networks contracts.
Bucher Industries fell after an update showed a drop in order uptake over the first nine months of the year, and the Swiss company said it expected demand to continue to slow amid challenging market conditions.
French IT services provider Atos was in the green after it said it will acquire German SAP specialist X-Perion Consulting
Alfa Laval also rose after third quarter core profits beat expectations and the Swedish industrial machinery manufacturer said it expected strong demand to improve even further in the fourth quarter.