European Shares Edge Higher In Cautious Trade

European stocks were broadly higher on Tuesday as signs of a slowdown in China’s economy spurred hopes for more policy support.

Official data showed that China’s services industry contracted in August for the first time since the height of the pandemic early last year.

Closer home, the number of unemployed people in Germany declined slightly in August, while the country’s jobless rate remained steady at 5.6 percent, official statistics showed.

Consumer prices in the euro zone rose 3.0 percent year-on-year in August, the fastest rate of growth since November 2011, according to a first estimate released by Eurostat, the European Union’s statistics agency. Prices rose an annual 2.2 percent in July.

The pan European Stoxx 600 edged up 0.2 percent to 473.83 after ending Monday’s session flat with a positive bias.

The German DAX gained 0.7 percent and France’s CAC 40 index rose 0.3 percent, while the U.K.’s FTSE 100 was little changed.

Dutch technology investor Prosus NV surged 4.4 percent. The company has agreed to buy Indian payments platform BillDesk for $4.7 billion.

Biotech company Medivir AB rallied 2.2 percent after it received approval from the British Medicines & Healthcare products Regulatory Agency for the phase 1/2a combination study with MIV-818 against liver cancer.

Bunzl Plc fell 2.6 percent after the British business supplies distributor flagged that it was facing supply chain disruptions, product shortages and a labour crunch in certain markets.

Travel-related stocks declined after European Union governments agreed to remove the United States from the EU’s safe travel list.

German airline Lufthansa dropped 1.1 percent, British Airways-owner IAG lost 2.7 percent, Wizz Air Holdings shed 2.4 percent, Ryanair Holdings fell 2.2 percent and Easyjet gave up 1.5 percent.

Ferguson rose about 2 percent after JP Morgan raised its price target on the plumbing and heating parts distributor.