European stocks rebounded on Wednesday after reports that Italy plans to reduce budget deficit by 2.0 percent in 2021.
The Italian newspaper Corriere della Sera reported that the government estimates a budget deficit of 2.4 percent of GDP for 2019, and then slash it to 2.2 percent for 2020.
Italian bond yields fell after the report, helping lift banking stocks. Banco BPM jumped 2 percent, BNP Paribas gained half a percent and Credit Agricole rose 1.2 percent.
The pan-European Stoxx Europe 600 index was up 0.2 percent at 382.62 in late opening deals after declining half a percent in the previous session.
French shares were marginally higher and the U.K.’s FTSE 100 was rising 0.2 percent while the German market was closed for a public holiday.
The pound held near three-week low as investors awaited U.K. Prime Minister Theresa May’s speech at Conservative Conference for directional cues.
Vodafone Group advanced 1.3 percent in London after it acquired spectrum in Italy to enable the deployment of new 5G technology for a total cost of 2.4 billion euros.
Grocer Tesco slumped more than 8 percent after reporting its first-half results.
In economic releases, the euro area private sector expanded at the slowest pace in four months in September on weak manufacturing activity, survey data from IHS Markit showed.
The final composite output index dropped to 54.1 from 54.5 in August and slightly below the flash estimate of 54.2.
September’s increase in activity, which marked the sixty-third successive month of growth, masked divergent trends between the manufacturing and services economies.
Eurostat figures showed that Eurozone retail sales dropped unexpectedly in August reflecting the weakness in food turnover.
Retail sales decreased 0.2 percent month-on-month, following a 0.6 percent drop in July. Economists had forecast a 0.2 percent increase for August. This was the second consecutive fall in sales.
British service sector activity maintained strong growth momentum in September, survey data from IHS Markit showed.
The IHS Markit/Chartered Institute of Procurement & Supply services Purchasing Managers’ Index dropped to 53.9 from 54.3 in August. The index was forecast to fall to 54.0.
by RTTNews Staff Writer
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