Europe open: Shares higher as investors digest weak Japan GDP

(Sharecast News) - European shares opened higher on Monday as investors digested weak GDP growth from Japan, while trade was expected to be muted with US markets closed and little in the way of major earnings news.

The pan-regional Stoxx 600 index had gained 0.37% to 619 points by 0820 GMT. With all major bourses higher, Germany's DAX was up 0.34%, France's CAC 40 rose 0.25% and the UK's FTSE 100 increased by 0.17%.

"US markets are closed today, and that may be a welcome relief to many, after last week was once again dominated by violent swings linked to artificial intelligence," said Hargreaves Lansdown analyst Matt Britzman.

"Some stocks are flying, and others are getting crushed in moves that often feel disconnected from fundamentals. Power and utility names were the clear winners as investors bet they'll be essential to the AI build-out, while anything tied to data or software found itself in the firing line."

"Away from the AI noise, falling bond yields and softer inflation offered some relief, but a few worrying signals around growing loan defaults were one reminder that not everything under the hood is improving."

The Japanese economy grew less than expected in the last three months of the year, according to official data published on Monday, narrowly avoiding a technical recession and increasing pressure on new Prime Minister Sanae Takaichi's government to provide fiscal stimulus.

GDP expanded by just 0.1% in the fourth quarter, well short of forecasts for growth of 0.4%. The growth followed a 0.7% contraction - revised downwards from an earlier reading of -0.6% - in the previous three months.

Reporting by Frank Prenesti for Sharecast.com