European markets reported mixed results in the opening minutes of trade as investors considered the unexpected China manufacturing sector weakness ahead of US monthly employment data.
The UK's FTSE 100 gained 0.2 percent while France's CAC-40 and Germany's DAX rose 0.1 and 0.2 percent respectively. Italy's FTSE MIB eased 0.1 percent.
Spain's IBEX plunged 2.1 percent after the short selling ban that was put in place last year came to an end during the previous session.
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The pan-European FTSEurofirst 300 index gained 0.1 percent to 1,165.9
The single currency remained firm against the dollar, trading at over $1.36.
Asian markets had ended mixed earlier as Chinese manufacturing data and the yen's weakness against the dollar impacted market sentiment.
Japan's benchmark Nikkei average gained 0.47 percent to 11191.34, while South Korea's KOSPI fell 0.21 percent to 1957.79. Australia's S&P/ASX 200 was up 0.87 percent to 4921.10.
In China, the Shanghai Composite Index rose 0.41 percent to 2419.02 while Hong Kong's Hang Seng was down 0.26 percent to 23667.03.
Following the initial US fourth-quarter Gross Domestic Product (GDP) announcement that failed to meet estimates, the crucial monthly non-farm payroll figures are set for release later today. Analysts remain positive, estimating a 160,000 rise in jobs and a steady unemployment rate of 7.8 percent.
Traders are also awaiting US manufacturing survey data from the Institute of Supply Management (ISM), for indications on the sector's performance in the beginning of 2013.
A host of indicators are set for release in Europe. In addition to eurozone unemployment figures and manufacturing data, Italy, Germany, France and UK are all expected to report their own PMI data. Other releases include eurozone flash inflation figures and unemployment rate.
The poor results from the Spanish markets can be explained by the prevailing feeling that short selling has been a major factor in the country's economic crisis over the past year. Although Greece, like Spain, decided to lift its short selling ban earlier this week, ministers in Athens excluded the country's crucial banking sector.
Spanish markets plunged as the country's short selling ban that had come into effect at the peak of the country's economic crisis in July had ended with the previous trading session. Short selling was considered a major factor that contributed to aggravating the Spain's troubles in the previous year. Greece too had decided to lift a short selling ban early this week, but excluded the crucial banking sector.
Twin Chinese Purchasing Managers Index (PMI) data that gave a mixed picture on conditions in the world's second-largest economy dominated Asian market sentiments. Official PMI figures showed that manufacturing activities slowed in January, marking a 50.4 reading from December's level of 50.6. Although the weak numbers raised concerns, analysts warn that the data could have been distorted by a change in the government's survey methodology and seasonal adjustments near the Chinese New Year period.
"Though it is below market consensus (also our forecast) at 51.0 and thus could be a bit disappointing, we expect markets won't significantly turn bearish as the PMI is quite an inaccurate barometer around the Chinese New Year holiday due to heavy seasonal adjustments," said economists from Bank of America Merrill Lynch in a note.
"We believe the Chinese economy and its related asset markets will remain in a sweet spot in the near term".
HSBC's final China PMI reading continued to provide an upbeat picture, rising to a two-year high of 52.3 in January, which was slightly over the preliminary reading of 51.9.
Japanese economic conditions returned to focus after official employment data showed that the jobless rate picked up to 4.2 percent in December, above analysts' expectations of a 4.1 percent increase. But Japanese markets shrugged off the weakness on corporate earnings news and yen's extended weak run against its peers.
The yen plunged to its lowest level in more than 30 months against the dollar and the euro, as traders anticipated Bank of Japan will take stronger fiscal stimulus measures to boost the economy.
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