European markets rise on economic recovery hopes
European stock markets are today stronger amid signs that the European economic downturn may not be as bad as first thought with manufacturing figures better than expected. It was the revision of the monthly manufacturing purchasing managers index, for 16 countries within the Euro zone, which caught the eye of investors having been revised upwards from 56.5 to 56.7 with anything above 50 indicating that the sector is expanding.
It is now believed that European bankers are turning more positive on the European economy although whether we will see a loosening of fiscal policies in the short term remains to be seen. There's still the danger of assuming that the economic difficulties are over in Europe, and indeed around the world, and potentially choking the cheap finance required to get European economies moving again.
It will be interesting to see how European stock markets react in the short to medium term because this is the first piece of good news we have had for some time. Many analysts will be cautious ahead of future economic data although if today's news is a trend setter then with any luck there could be some more prosperous days ahead.
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