Eurozone Economy Shows Signs of Resilience as European Stocks Rebound

European stocks rebounded on August 21 as indicators pointed to resilience in the eurozone economy. However, persistent inflation concerns tied to escalating U.S.-Iran tensions weighed on sentiment. The STOXX Europe 600 Index fell 0.56% for the week, its second consecutive weekly decline. Despite this, some sectors showed gains, such as mining stocks, which lifted the FTSE 100 Index. Gold producer Endeavour Mining rose 4.1%, and copper major Antofagasta climbed 5.4%, supported by higher gold and copper prices. The eurozone's flash composite PMI for August reached its highest level since November last year, with new orders expanding, particularly in manufacturing, while export orders recovered. This suggests the eurozone economy continues to shake off the impact of higher energy prices, according to Harry Chambers, assistant economist at Capital Economics. The European Central Bank (ECB) is still expected to raise interest rates before the end of the year, with a probability exceeding 90% for a September hike.