Cheerful economic data lift European shares to the highest in two weeks

European shares maintained its rally on Thursday, rising to the highest levels in over two weeks, amid solid economic news from Europe and the U.S.

Markit`s Composite Purchasing Managers` Index (PMI) of companies across the euro zone rose to 54.0 in July from 52.8, its highest since April.

Equities across Europe edged higher on the news, as investors again shrugged off worries about Russia`s relationship with the West.

Germany`s figures also came in better than expected, with the manufacturing PMI rising to a three-month high of 52.9. The composite PMI climbed to 55.9, also a three-month high. In France, the composite reading indicated that the economy weakened at a slower pace than in July, with the services sector returning to growth while manufacturing fell further into contraction.

-  Stoxx      600   advanced 0.43 percent or 1.43 points to  344.33, its highest close since July 7

-  Stoxx 50   advanced 0.84% or 26.94 points to 3220.07

The unemployment rate in Spain dropped to 24.5% in the second quarter from 25.9% in the first three-months of the year. Additionally, the number of jobless people dropped by a little over 300,000.

The improvement in the labor market comes as the Spanish economy is recovering from a six-year slump. On Wednesday, the central bank said it anticipates that the economy may grow 1.3% for 2014 as a whole.

- Spain`s IBEX 35 index rallied 1.89% or 201.60 points to 10,860.70 , its highest close in more than two weeks.

Meanwhile, the U.S. Labor Department released a report on Thursday showing that U.S. initial jobless claims unexpectedly fell to their lowest level in over eight years in the week ended July 19th. Initial jobless claims slid to 284,000, a decrease of 19,000 from the previous week`s revised level of 303,000.

-The British  FTSE 100   advanced 0.34% or 23.31 points to   6821.46

-The French  CAC 40   advanced 0.78% or 34.33 to   4410.65

-Frankfurt’s  DAX 30   advanced 0.42% or 40.50 points to  9794.06

In indivudual shares across Europe, oil services company Technip lost 8.6 percent after warning about mounting cost pressures.

Software AG rose in Frankfurt despite the business software firm posting lower second-quarter net income of 14.2 million euros, down from 28.8 million euros a year ago.

BASF Group declined 1.3 percent after the chemical giant reported second-quarter profit that fell short of analysts` expectations.

Unilever Plc missed second-quarter sales estimates due to a continued slowdown in emerging markets.

Roche added 0.65 percent after the Swiss drug maker confirmed its full-year outlook.

Telecommunications and wireless equipment maker Nokia Corp jumped 7 percent after reporting higher profits and raising its outlook for its core networks unit.