By Sara Sjolin and Barbara Kollmeyer, MarketWatch
LONDON (MarketWatch) -- European stock markets moved higher on
Monday, lifted by HSBC Holdings PLC after the heavyweight bank
posted results, while the broader market welcomed encouraging data
on euro-zone factory activity. Airline and travel stocks were among
the biggest losers, after Ryanair Holdings PLC cut its outlook and
warned of falling fares.
The Stoxx Europe 600 index rose 0.4% to 322.61, extending gains
seen last week, when the benchmark scored its fourth weekly advance
in a row.
Banks helped support the main Europe index, with HSBC (HBC) up
2.4% after posting a 28% rise in third-quarter profit. The gain
helped lift the U.K.'s FTSE 100 index 0.5% to 6,767.10.
Shares of Ryanair led the decliners list, tumbling 12% after the
Irish-based budget airline cut its full-year guidance due to a dip
in average fares. Ryanair said it expects fares to fall by a
further 9% in the third quarter and by up to 10% in the fourth
quarter.
The news rippled through the sector, with EasyJet PLC losing
4.1%, Thomas Cook Group PLC down 2.5%, and Air France-KLM SA
dropping 2.1%.
Shares of Weir Group PLC were also being hit hard, off 7.1%
after the engineering company cut its 2013 revenue expectations due
to further project-delivery delays and industrial unrest in South
Africa.
More broadly, investors welcomed data that showed euro-zone
factory activity edged higher in October, thanks to modest strength
in Germany and other northern economies. The Markit manufacturing
purchasing managers' index for currency bloc rose to 51.3 from 51.1
in September, above the 50 threshold that separates expansion from
contraction. The reading was unchanged from an earlier
estimate.
"More encouraging indications about the recovery can be gained
by looking at increasingly broad-based nature of the upturn, and
especially the fact that increasingly robust gains in production
are now being seen in countries such as Spain, Italy and Ireland,
to suggest that structural reforms to boost competitiveness are
starting to pay off," said Chris Williamson, chief economist at
Markit, in the release.
PMIs were also in the spotlight in China, where the country's
official non-manufacturing purchasing managers' index rose to 56.3
in October, marking a 14-month high.
Some miners pushed higher after the data, as China is a big user
of natural resources. Shares of Rio Tinto PLC (RIO) rose 2.5%, and
shares of BHP Billiton PLC (BHP) gained 1.1%.
Among other notable movers, shares of PostNL NV jumped 6.4%
after the Dutch mail firm lifted its full-year outlook.
The German DAX 30 index rose 0.3% to 9,037.55, while the French
CAC 40 index added 0.3% to 4,285.02.
Subscribe to WSJ: http://online.wsj.com?mod=djnwires