US holiday keeps a lid on European markets

According to IHS Markit and the Chartered Institute of Purchasing and Supply, the purchasing managers' index for Britain — a broad gauge of economic activity — jumped to 53.2 points, reversing a record fall to 47.4 in July experienced after the June 23 referendum.

British stocks slipped as investors marked down export-oriented companies in light of the pound's move.

ANALYST TAKE: "The latest reading negates some of the pessimism from the July reading, which sparked fears of a substantial slowdown in business activity following the EU referendum after showing the largest decline on record," said David Cheetham, market analyst at XTB.

Oil prices pushed ahead amid speculation of a production freeze after the world's two largest oil producers, Russia and Saudi Arabia, agreed to act together to stabilize global oil output.

Benchmark U.S. crude oil gained 70 cents to $45.14 a barrel in electronic trading on the New York Mercantile Exchange, while Brent crude, the benchmark for international oil prices, rose 67 cents to $47.50 a barrel.