A mixed bag for Europe's services sector as Spain sees fastest growth since 2007

This morning has brought mixed news for Europe's services sector, with purchasing managers' index surveys for December released by Markit.

The Eurozone's PMI came in in line with expectations at 51 - a slight edging down from November's 51.2, but still remaining in growth.

Spain's services sector saw an unexpected pick up, growing at its fastest pace since 2007, with the survey increasing to 54.2, from 51.5 - consensus was that it'd remain unchanged.

Italy, however, came short of expectations, shrinking for a second month, with the index at 47.9 - up slightly on November's 47.2, but still below the reading of 50 that indicates growth.

Germany saw a slowdown in sector expansion, with PMI at 53.5 - still in growth, but short of the 54.0 prediction and November's 55.7.

France saw an improvement on expectations, with a figure of 47.8, although this is down from November's 48.0 and still below growth.

Howard Archer of IHS comments on this morning's results:

Looking ahead, the hope for the Eurozone is that recent improved confidence will encourage businesses to lift their employment and investment plans as 2014 progresses, and will also encourage consumers to spend more.

Nevertheless, the upside for domestic demand in the Eurozone is likely to remain constrained by a number of factors.

Consequently we expect Eurozone GDP growth to improve only modestly to around 1.0 per cent in 2014 after likely contraction of 0.4 per cent in 2013.