Europe midday: Stoxx 600 hits another record as banking stocks rise

(Sharecast News) - European stock markets pushed further into record territory on Friday, extending their winning streak into the sixth day, despite a raft of mostly worse-than-expected economic data.

The pan-European Stoxx 600 index was up 0.4% at 570.08, on track to record its third record close in as many days, with London's FTSE 100 also up 0.7% at new all-time highs.

US stock futures were also pointing to further gains on Wall Street as investors largely shrug off an ongoing government shutdown despite the gridlock delaying crucial economic data, including Friday's scheduled non-farm payrolls report.

"There is growing expectation that the shutdown in Washington might continue until mid-October, with the scheduled jobs report due out today unlikely to be released," said AJ Bell investment director Russ Mould. "How long investors remain relaxed about this state of affairs remains hard to predict, but one worry is that it makes it significantly harder for the Federal Reserve to make informed decisions around interest rates."

Economic data disappoints

Back on this side of the Pond, the focus was on economic data after the release of a barrage of revisions to service-sector purchasing managers' indices (PMIs).

The HCOB eurozone services PMI was revised down to 51.3 from 51.4, though up from 50.5 and still its highest level in nine months. Revisions to service-sector activity in Germany and France showed weaker-than-expected readings, while numbers in Spain and Italy were revised up.

The HCOB eurozone composite PMI - which tracks both the services and manufacturing sectors combined - increased for the fourth month in a row in September, to 51.2 from 51.0 in August.

Over in the UK, the S&P Global services PMI came in at 50.8 last month, down from the 16-month high of 54.2 in August and lower than the flash reading of 51.9 released last week - marking the weakest rate of growth since April.

Meanwhile, the eurozone producer price index (PPI) fell more than expected in August, according to Eurostat. PPI decreased by 0.3% after a 0.3% increase in July, missing the -0.1% consensus forecast. Compared with August 2024, the PPI was 0.6% lower, marking the first year-on-year decline since November 2024.

Banks provide a boost

Austrian bank Raiffeisen was the standout riser across the continent, gaining 6% on reports that the EU is considering unfreezing sanctions on �2bn of assets linked to Russian oligarch Oleg Deripaska to compensate Raiffeisen for a fine it had to pay in Russia.

Spanish lenders Banco de Sabadell, Banco Santander, CaixaBank, BBVA, Unicaja Banco and Bankinter were also putting in decent gains, along with Germany's Commerzbank, France's BNP Paribas and the UK's Barclays.

In London, pubs group JD Wetherspoon underwhelmed with a 5.1% increase in annual underlying sales, while profits rose 10.1%.