Euro-zone GDP Expands; Delhaize Slumps

Arthi Gupta
13 Aug, 2010
New York City

The European indexes pared early gains amidst concerns of global economic recovery. Euro-zone trade balance turned surplus of

[R]4:00 PM Frankfurt – The European indexes pared early gains amidst concerns of global economic recovery. Euro-zone trade balance turned surplus of €2.4 billion in June and GDP accelerated 1% in the second quarter. German GDP expanded at 2.2% in the second quarter.][/R]

U.S. stocks declined after weaker-than-estimated inflation and retail sales data and Asian markets gained. French GDP expanded 0.6% in the second quarter and Swiss Central Bank posted loss in the first half.

In Paris CAC 40 Index dropped 11.27 or 0.31% to close at 3,609.80 and in Frankfurt DAX Index edged lower 25.89 or 0.42% to close at 6,109.28.

The euro-zone''s trade balance with the rest of the world turned surplus in June from a deficit in May, according to official figures released today. The unadjusted surplus was €2.4 billion in June, compared with a deficit of €3.3 billion in May. The reason was a 5.2% rise in exports from May, compared with a 4.3% rise in imports.

On a seasonally adjusted basis, the trade deficit was €1.6 billion in June.

The trade deficit for the 27-nation European Union was €9.6 billion in June as against the €14.8 billion deficit recorded in May, according to the official figures released from Eurostat today.

Euro-zone gross domestic product grew 1% sequentially in the second quarter, following a 0.2% rise in the first quarter, according to flash estimates published by Eurostat today.

From a year ago, the economy expanded 1.7%, more than double the first quarter''s 0.6% increase. The EU 27 also grew 1% sequentially and 1.7% on an annual basis in the second quarter.

The German economy posted a record sequential growth of 2.2% in the second quarter, after expanding 0.5% in the first quarter, according to the Federal Statistics Office report published today.

The price-adjusted GDP grew at a faster pace of 4.1% in the second quarter of 2010 compared to the second quarter of 2009.

The French economic growth rose more than expected in the second quarter, boosted by consumer spending and inventory building.

Gross domestic product rose 0.6% sequentially in the second quarter as against a revised first quarter GDP growth of 0.2%, according to preliminary data released from the statistics office Insee today.

French payroll employment increased 0.2% or 35,000 in the second quarter from the first quarter, according to the flash estimate from the statistics office Insee released today. In the first quarter, 23,900 jobs were created.

Employment in manufacturing dipped 0.5% sequentially and in construction declined 0.1%. But, employment in services grew 0.5% in the second quarter. Temporary employment rose 4.9%.

The Swiss National Bank today reported a loss for the first half of 2010 as a result of exchange-rate-related valuation losses on investments in euros. However, the extent of the loss was checked by the rise in the price of gold and earnings on foreign currency investments.

The loss totaled Sfr2.8 billion in the first half of 2010 compared to a profit of Sfr5.25 billion in the same period of last year.

Gainers & Losers

Delhaize Group slumped 10% to €52.45 after the Belgium-based food retailer reported second quarter revenues rose 4.7% to €5.33 billion from €5.09 billion in the prior year quarter. Net profit in the quarter declined 8.8% to €114 million or €1.13 cents per diluted share, compared to €125 million or €1.24 cents per share last year.

Electricite de France SA declined 0.03% to €33.39 after the French energy regulator granted approval for raising electricity prices starting Aug. 15.

Infineon Technologies AG dropped 2.13% to €4.60 after the German semiconductor and system solutions designer and developer and International Business Machines said they sold their stake in a French joint venture Altis Semiconductor to Altis International for an undisclosed amount.

Royal Dutch Shell plc gained 0.63% to 55.75 pence after the oil and gas explorer completed a $5.1 billion revolving credit facility with a group of relationship banks.

Schibsted ASA rose 11.95% to 145.00 kroner after the Norwegian media company reported second-quarter net income of 710 million kroner.

ThyssenKrupp AG O.N. rose 1.97% to €23.30 after the integrated materials and technology group swung to a third-quarter net profit of €272 million from a loss of €639 million in the year-ago period.