BRUSSELS/FRANKFURT/PARIS (dpa-AFX) - European stocks look set to open a tad higher on Wednesday after a report showed growth in China's service sector accelerated in August despite broader economic headwinds.
China's private sector logged its fastest growth in four months in August as both manufacturers and service providers see improved rates of activity growth, survey data from IHS Markit showed. The Caixin composite output index climbed to 51.6 from 50.9 in July.
Activity across the service sector advanced at a faster pace than that seen for the manufacturing sector. The services Purchasing Managers' Index came in at a three-month high of 52.1, up from 51.6 in July.
Asian markets rose, although underlying sentiment remained cautious after the benchmark U.S. Treasury yield touched its lowest level in three years.
The pound extended the previous session's rebound after a British cross-party alliance defeated Prime Minister Johnson in an effort to block a 'no-deal' Brexit.
Gold held steady near one-week high while oil recovered some ground after hitting its lowest level in a month during the previous session as U.S. President Donald Trump threatened to get tougher on China if he wins re-election.
In economic releases, final Purchasing Managers' survey results and retail sales report from the euro area are due later in the session, headlining a busy day for the European economic news.
Across the Atlantic, trading may be impacted by reaction to remarks by several Federal Reserve officials as well as the Fed's Beige Book, a compilation of anecdotal evidence on economic conditions in the twelve Fed districts.
Overnight, U.S. stocks ended lower as a new round of trade tariffs went into effect and disappointing manufacturing data reinforced worries over slowing growth.
The Dow Jones Industrial Average and the tech-heavy Nasdaq Composite fell around 1.1 percent while the S&P 500 declined 0.7 percent.
European markets snapped a four-session winning streak on Tuesday amid political uncertainty in the U.K.
The pan European Stoxx 600 shed 0.2 percent. The German DAX dropped 0.4 percent, France's CAC 40 index slid half a percent and the U.K.'s FTSE 100 eased 0.2 percent.
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