European shares struggle to gain, PMI data awaited

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Aug 21 (Reuters) – European shares were flat on Friday ahead of business activity data that could throw light on the pace of economic recovery in the continent, while a stronger pound dragged UK’s exporter-heavy FTSE 100 lower.

The pan-European STOXX 600 index was up 0.1% by 0720 GMT, still reeling from weak U.S. data and downbeat tone from the U.S. Federal Reserve that sparked a selloff on Thursday.

The blue-chip FTSE 100 slipped 0.3% even as data showed retail sales surged past their pre-coronavirus level in July, although economists feared the broad recovery could prove temporary.

All eyes will be on the Markit’s flash survey of European purchasing managers in August, which is expected to show that a pick-up in business activity stagnated in August after a rebound in July.

Travel and leisure stocks were the biggest sectoral gainers, up 1.2%, but losses in financial services and telecoms dragged on the broader index.

Irish building and insulation materials firm Kingspan jumped 5.5% after its chief executive said the company saw significant pent up demand post-lockdown.

Swiss drugmaker Novartis gave the biggest boost to the STOXX 600 after it won U.S. health regulator’s approval to repurpose an 11-year-old blood cancer drug against multiple sclerosis. (Reporting by Sruthi Shankar in Bengaluru; Editing by Arun Koyyur)

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