European Markets Finished Mostly Higher Despite Mixed Economic Data

(RTTNews) - The majority of the European markets ended Monday's session with modest gains. Investors were pleased with the trade data released by China over the weekend. However, Eurozone investor sentiment and German industrial production unexpectedly declined Monday. Germany's trade surplus also declined more than expected in October.

France's central bank on Monday revised its outlook for fourth quarter gross domestic product growth upward, while business sentiment recorded an unexpected improvement in November.

According to a monthly business survey published by the Bank of France, the economy is seen growing 0.5 percent in the fourth quarter of 2013, up from 0.4 percent growth forecast earlier.

The business sentiment indicator for the manufacturing sector rose to 101 in November from 100 in October. Economists had forecast a decline to 98.

Greece's Parliament approved a budget plan for 2014 on Saturday that predicts the end of a six-year-long recession for the debt-ridden euro nation in 2014. The plan was passed with 153 lawmakers voting in favor in the 300-seat Parliament.

The budget forecasts a 0.6 percent growth for the economy in 2014 after six years of painful recession, mostly triggered by draconian austerity measures meant to put the country's public finances back on track.

The government expects a budget surplus before interest payments of EUR 812 million this year, which will then rise to EUR 2.9 billion in 2014.

The worst is over in Europe and member states should work towards greater growth and integration, Spanish Prime Minister Mariano Rajoy told El Pais in an interview.

The European Central Bank has several monetary tools at its disposal to apply if the situation demands, but cautioned that government bond purchases would pose immense challenges, Executive Board member Yves Mersch said Monday.

At a conference in Frankfurt, Mersch said, "Should the need for further monetary measures arise, the necessary tools are available."

Official Chinese data released over the weekend showed that the nation's trade surplus increased to $33.80 billion in November from $31.1 billion in the previous month. Exports jumped 12.7 percent, up from 5.6 percent in the previous month and beating forecasts for a 7 percent rise.

Another government report showed that consumer prices in China rose 3.0 percent year-over-year in November, falling below expectations for an increase of 3.2 percent amid a slowdown in food price inflation.

The Euro Stoxx 50 index of eurozone bluechip stocks increased by 0.40 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, added 0.10 percent.

The DAX of Germany climbed by 0.25 percent and the FTSE 100 of the U.K. rose by 0.18 percent. The CAC 40 of France advanced by 0.11 percent, but the SMI of Switzerland fell by 0.12 percent.

In Frankfurt, RWE increased by 0.82 percent and peer E.ON added 0.52 percent.

Merck dipped by 0.23 percent. S&P Capital upgraded the stock to ''Hold'' from ''Sell.''

Tom Tailor dropped by 4.68 percent. Berenberg downgraded the stock to ''Hold'' from ''Buy.''

Sky Deutschland advanced by 5.15 percent, after it bought the German broadcast rights for the UEFA Champions League through the end of the 2017-2018 season.

In Paris, Danone declined by 0.17 percent. Exane BNP downgraded its rating on the stock to ''Underperform'' from ''Neutral.''

Merrill Lynch upgraded its rating on GDF Suez to ''Buy'' from ''Neutral.'' The stock advanced by 2.03 percent.

In London, mining stocks turned in a weak performance, due to the decline in metal prices. Fresnillo tumbled by 1.98 percent. Vedanta Resources and Randgold Resources fell by 2.72 percent and 1.54 percent, respectively.

Tullow Oil decreased by 3.34 percent. The energy firm, which issued an update on its East Africa Exploration, said a well in the South Omo block onshore Ethiopia would be plugged and abandoned as a dry hole.

Kentz said it has entered into an agreement to acquire the US-based Valerus field solutions business for $435 million in cash. The stock surged by 12.97 percent.

Lloyds Banking Group said it has agreed to sell a portfolio of UK corporate real estate loans to Promontoria Holding 87 B.V., for 90 million pounds in cash, as part of the group's continued non-core asset reduction program. The stock finished down by 0.05 percent.

Aviva climbed by 2.27 percent, after Bank of America Merrill Lynch added the stock to its "Europe 1" list.

Eurozone investor sentiment declined unexpectedly in December from a two-and-a-half year high, a monthly survey by the think tank Sentix showed on Monday. The confidence index came in at 8 points in December, down from 9.3 in November. The reading was forecast to rise to 10.3.

Casting doubt over the sustainability and strength of recovery, German industrial production declined for the second consecutive month in October with contractions in all sub-sectors. Moreover, exports from the largest euro area economy slowed notably in October. Industrial production fell unexpectedly by 1.2 percent month-on-month, while it was forecast to rise 0.7 percent, data showed Monday.

Germany's trade surplus declined more than expected in October, data from the Federal Statistical Office revealed Monday. The trade surplus fell to EUR 17.9 billion in October from EUR 20.3 billion in September. Economists expected a decline to EUR 18.3 billion.

Germany's labor costs increased at the weakest pace in three years in the third quarter, data from the Federal Statistical Office revealed Monday. The labor cost index rose a calendar adjusted 1.6 percent in the third quarter from a year earlier. This was the lowest increase since the fourth quarter of 2010, the statistical office said.

Demand for staff in the U.K. increased at the sharpest rate since July 1998, largely driven by strong trends in private sector, the Report on Jobs released by Markit and consultancy firm KPMG showed Monday.

Meanwhile, the availability of candidates to fill permanent roles fell further in November, with the rate of decline quickening to the sharpest since July 2007. Likewise, temporary/contract staff availability decreased, at the fastest pace in nine years.