German stocks were modestly higher on Thursday as a preliminary survey showed German business activity contracted in August for a second consecutive month and by more than expected, reinforcing investor bets on a September ECB rate cut.
Dovish Fed expectations also underpinned sentiment following the release of minutes from the Federal Reserve meeting and a downward revision to U.S. payrolls data.
The benchmark DAX was up 43 points, or 0.2 percent, at 18,492 after rising half a percent the previous day.
In corporate news, ticketing group CTS Eventim soared 7 percent after upgrading its full-year earnings outlook.
Lender Deutsche Bank rallied 2.6 percent after settling with over 80 plaintiffs in the Postbank AG litigation.