LONDON (AP) — News of a rebound in China's economy shored up markets on Friday at the end of a volatile week that saw the U.S. veer dangerously close to defaulting on some of its debts.
Now that the U.S. Congress agreed to raise the country's borrowing limit, eliminating for now the risk of default, investors were able to focus on something other than the squabbling in Washington a day after the S&P 500 index closed at a record high.
"The sentiment in the market today is one of mild relief and back to business as usual," said David White, a trader at Spreadex.
China's economic rebound in the third quarter was the main driver of sentiment on Friday. Government figures showed that the world's number 2 economy grew by an annual rate of 7.8 percent in the third quarter, up from a two-decade low of 7.5 percent during the previous three-month period.
The improvement eased fears of a deeper Chinese slowdown that could crimp the world economy and should ensure that full-year growth doesn't fall below Beijing's 7.5 percent target.
Corporate earnings were also on the radar of most traders — the start of the quarterly results season had taken a backseat to the developments in Washington. On Friday, solid earnings from General Electric and Morgan Stanley helped shore up the market mood.
In Europe, the FTSE 100 index of leading British shares was up 0.5 percent at 6,611 while Germany's DAX rose 0.3 percent to 8,839. The CAC-40 in France was 0.9 percent higher at 4,276.