Europe open: Stocks hit new highs as economic data beats forecasts

(Sharecast News) - European stocks were pushing higher for fourth time in five sessions on Friday, with the Stoxx 600 continuing to hit new highs after economic data came in ahead of expectations. The Stoxx 600 was up 0.2% at 575.53, topping Thursday's record close of 574.43, with most major indices across the continent recording moderate gains early on.

Data out early on showed that the private sector activity across Germany grew much more than expected in October. The flash reading of the S&P Global/HCOB composite PMI rose to 53.8 this month, from 52.0 in September, hitting its highest mark in 29 months as an ongoing downturn in manufacturing was offset by a jump in activity in the services sector.

"This is an unexpectedly good start to the final quarter. Activity in the service sector has increased significantly, and output in the manufacturing sector has risen for the eighth consecutive month. This means that the economy as a whole is also showing accelerated growth," said Cyrus de la Rubia, chief economist at HCOB.

Still to come are the overall activity figures for the wider eurozone, due out at 1000 CEST, with consensus forecasts pointing to a slight fall in the composite PMI to 51 from 51.2. UK PMIs are due out at 1100 CEST.

Meanwhile, UK retail sales unexpectedly grew by 0.5% in September, easing from the revised 0.6% increase in August but marking the fourth straight month of growth.

"Markets had been predicting a 0.2% decline, but rising real wages and a steadying house market are helping to drive an uplift in overall consumer spending," said Aarin Chiekrie, equity analyst at Hargreaves Lansdown.

In equity news, NatWest was trading 4% higher in London after the banking group raised its income and returns guidance for 2025 following a strong performance in the third quarter, helped by "healthy levels of customer activity". Net profits surged 35.1% to £1.68bn in the third quarter.

Swedish crane maker HIAB dropped 11% after reporting that first-half sales were down double digits with comparable earnings down 24% as profitability was hit by lower sales in the US.