German GDP Estimate Raised, Stocks Up

Arthi Gupta
19 Aug, 2010
New York City

The European indexes gained after Bundesbank raised its outlook for German GDP expansion to 3% from 1.9% in 2010. German PPI rose in July and Swiss trade surplus increased in the month. Greek industrial turnover growth slackened but new orders rose in June.

[R]4:00 PM Frankfurt – The European indexes gained after Bundesbank raised its outlook for German GDP expansion to 3% from 1.9% in 2010. German PPI rose in July and Swiss trade surplus increased in the month. Greek industrial turnover growth slackened but new orders rose in June.[/R]

U.S. stocks fell after weaker-than-estimated weekly jobless claims data and Asian markets climbed. Dutch unemployment fell in July and consumer sentiment improved in August.

In Paris CAC 40 Index decreased 15.63 or 0.43% to close at 3,632.30 and in Frankfurt DAX Index edged lower 22.52 or 0.36% to close at 6,163.79.

The German central bank, Bundesbank raised its full-year growth forecast for Europe''s largest economy. In its August report, the Bundesbank lifted its 2010 forecast to 3% growth, up from its previous calendar-adjusted forecast of expansion of 1.9%.

""The outlook for the current year remains favorable, even if there are signs for a slowing of global production activity and trade,"" the report said. ""The overall trend of the German economy is positive and the upswing ought to continue.""

German annual producer price inflation continued to increase in July, according to a report by the Federal Statistics Office released today.

The producer price index rose 3.7% year-on-year in July, as against a 1.7% growth in June. Producer prices increased for the fourth consecutive month.

The price index for intermediate goods grew 5.5% annually in July compared to 5% in June. Energy prices rose 6.7%. Excluding energy, producer prices increased 2.4% on an annual basis in July and edged higher 0.1% compared to the preceding month.

On a monthly basis, the PPI rose 0.5% in July compared to 0.6% growth in June.

Switzerland''s trade surplus rose to Sfr88 billion in July compared to Sfr1.77 billion in June, according to data published by the Federal Customs Administration today.

Exports showed an annual growth of 2.2% in July in real terms after rising 14.7% in June. Imports rose 0.3% in July compared to a 13.2% increase seen in June. On a monthly basis, exports edged higher 1.9%, while imports dipped 4%.

Dutch unemployment continued to fall for the fifth month in July, according to official data released today. However, confidence among Dutch consumers improved for the second straight month in August.

The number of unemployed persons fell to 426,000 in July from 430,000 in June after adjusting for seasonal variations, the Central Bureau of Statistics said. However, the seasonally adjusted jobless rate remained steady at 5.5%.

On an unadjusted basis, the number of unemployed persons declined to 449,000 in July versus 441,000 in June.

In a separate data, the statistics office said that the consumer confidence indicator improved in August from July. The consumer confidence index increased to minus 11 in August from minus 14 in July.

The Greek industrial turnover growth eased in June from the previous year, but new orders increased, the statistics office said on Thursday.

The industrial turnover increased 6.1% on an annual basis in June as against a 13.6% growth in the May. The turnover increased for the seventh consecutive month. A year earlier, industrial turnover slipped 26.9%.

The statistics office said industrial new orders grew 1.9% annually in June, compared to a 1.9% fall in May. A year ago, new orders decreased 33.8%. The new orders index in the domestic market fell 11.4% and new orders for the non-domestic market grew 27.4%.

Gainers & Losers

Accor SA fell 0.31% to €23.74 after the French hotel and services giant plans to have 90 hotels in operation in India by 2015, Chief Executive Gilles Pelisson told reporters in New Delhi.

AMEC Plc dropped 0.22% to 888.50 pence after the provider of consultancy, engineering and project management services announced that it has been awarded a contract worth over £60 million by EDF Energy to extend a gas storage facility in Cheshire.

A.P. Moller- Maersk A/S declined 0.13% to DKK47,610 after the Danish conglomerate reported first half revenue rose 20% to DKK153.5 billion from DKK127.34 billion last year. Net profit in the period was DKK13.4 billion compared to a loss of DKK3.67 billion in the year-ago period.

The company said it was helped by a recovery in freight rates and volumes to 2008 levels. Freight rates for the half-year period surged 31% and container shipping volumes increased 11% compared with the year-ago period.

Basilea Pharmaceutica AG slumped 3.31% to Sfr58.50 after the biopharmaceutical company reported first-half net loss narrowed 63% to Sfr24.9 million from Sfr66.5 million in the prior year.

Holcim Ltd. plummeted 4.73% to Sfr64.50 after the cement producer reported second quarter net sales increased 11% to Sfr6.16 billion from Sfr5.56 billion in the comparable period. Net income in the quarter declined 12% to Sfr399 million from Sfr453 million a year earlier.

Koninklijke Boskalis Westminster N.V. gained 2.41% to €33.82 after the world’s biggest dredging company reported a first-half profit of 123.9 million euros ($158.7 million). The company raised its 2010 profit forecast, and said earnings will increase by as much as 15% reversing its earlier outlook of a decline in profit for the year.