(Reuters) -Miners and luxury firms lifted European shares on Wednesday after strong data from China brought relief to investors fearful of an economic slowdown, while declines in shares of eurozone’s biggest bank BNP Paribas (OTC:BNPQY) kept the gains in check.
The continent-wide STOXX 600 rose 0.2% by 0900 GMT, kicking off the month on a steady ground after a solid start to the year.
China’s factory sector grew in February at the fastest pace in more than a decade, an outlier in Asia, where manufacturing growth stalled elsewhere.
Italian luxury group Moncler climbed 7.5% to the top of the STOXX 600 after its sales jumped 25% at constant exchange rates to come in ahead of forecasts.
“The reopening of China post-COVID would have a positive effect on global growth.. in general, you would say that for a lot of luxury names recovering Asian demand is an important driver,” said Richard Flax, chief investment officer at Moneyfarm.
The European basic resources index advanced 2.6%, set for its biggest one-day percentage gain since November, as metal prices jumped.
China-exposed autos index added 1.5%.
European shares have had a robust start to the year as relaxation of China’s zero-COVID protocols breathed life into hopes of demand recovery. The STOXX 600 notched its fourth positive month in five in February.
However, risky assets fell out of favour as fears of further monetary tightening by the European Central Bank to tackle sticky inflation weighed on the minds of investors.
Data on Wednesday showed regional inflation from Germany ticked up last month, with all eyes now on preliminary euro area wide consumer price inflation reading for February due on Thursday.
Euronext NV rose 4.4% after the exchange operator withdrew from its 5.5 billion euro ($5.82 billion) indicative offer to acquire fund distribution firm Allfunds. Allfunds fell more than 12% to the bottom of the STOXX 600.
BNP Paribas fell 3.4% after the Belgian state participation agency SFPI said the country is preparing the sale of a third of its 7.8% equity stake in the bank.
Puma slipped 2.1% after the sportswear maker forecast 2023 operating profit around last year’s level weighed by currency effects and higher freight and raw material costs.