German WPI Rises; French Current Account Deficit Widens

Arthi Gupta
12 Oct, 2010
New York City

The European indexes gained after German inflation and WPI rose in September. French current account deficit widened in August and Holland recorded trade surplus of

[R]4:00 PM Frankfurt – The European indexes gained after German inflation and WPI rose in September. French current account deficit widened in August and Holland recorded trade surplus of €3 billion. Hungary and Swedish inflation rose in September.[/R]

U.S. stocks declined awaiting Fed minutes and Asian stocks fell after China reportedly raised reserve requirements for six large commercial banks.

Monster Worldwide Inc. said that European online hiring growth continued to accelerate on an annual basis in September. The Monster employment index rose 21% in September from the previous year to 117, reaching the high last seen in December 2008.

OECD area unemployment rate fell to 8.5% in August from 8.6% in July, the Organization for Economic Cooperation and Development said Tuesday. In August, Spain recorded the highest jobless rate, followed by the Slovak Republic, Ireland, Hungary and Portugal. The number of unemployed persons in OECD countries stood at 45.5 million in August.

In Paris CAC 40 Index decreased 21.37 or 0.57% to close at 3,747.12 and in Frankfurt DAX Index edged lower 5.24 or 0.08% to close at 6,304.27.

Germany''s wholesale price index rose 7.6% annually in September, following a 6.4% gain in August, the Federal Statistics Office said today. This was the fastest increase so far in the year.

On a monthly basis, the index of wholesale prices rose 1% in September, as against 1.6% increase in August.

Germany''s consumer price measure of inflation rose in September, led by higher prices for energy and food, according to official data released today. Statistics office Destatis said the consumer price index rose 1.3% annually, from the 1% rate recorded in August. The rise was mainly due a 4.6% rise in energy prices and a 3% increase in food costs.

On a monthly basis, consumer prices fell 0.1% in September. Prices remained unchanged in August.

The French current account balance deficit widened to €4 billion in August, compared to July''s revised shortfall of €2.1 billion, according to data published by the Bank of France today.

The surplus in services fell sharply to €0.7 billion in August from €1.9 billion in July.

Consumer prices in Hungary increased 3.8% annually in September, compared to a 3.7% growth in the August, the Hungarian Statistics Office said today. Food prices increased 3.9% in September from a year earlier, faster than 3.7% growth in August.

On a monthly basis, consumer prices decreased 0.1% in September, following a 0.6% drop in August. Food prices decreased 0.4% on a monthly basis in September.

Swedish consumer prices increased for a tenth consecutive month in September and at the strongest pace in the current sequence, official data showed today.

Swedish annual inflation accelerated to 1.4% in September from 0.9% in August, Statistics Sweden said today. Consumer prices rose 0.8% from August mainly due to seasonally normal price increases for clothing and footwear, the statistics office said.

In another report, the Swedish government said its 2011 budget is focused on supporting the recovery of the economy and promoting full employment.

Finance Minister Anders Borg today presented the proposed central government budget for 2011 to the Riksdag. In the budget bill, the government proposed measures costing a total of SEK 13 billion.

The government now forecasts a GDP growth of 4.8% this year, which is better than the previous 4.5% estimate. But year 2011 growth was lowered to 3.7% instead of 4%. The number of people employed is forecast to rise by approximately 220,000 between 2010 and 2014.

The Netherlands recorded a trade surplus of €3 billion in August, up €0.9 billion from last year, the Central Bureau of Statistics said today.

Exports increased 26% annually to €29.7 billion, while imports rose nearly 25% to €26.7 billion.

Gainers & Losers

Air Berlin Plc fell 0.47% to €3.16 after the aviation company appointed 64-year-old Dr. Hans-Joachim Körber, currently a board member for the airline company, as the Chairman of the board effective December 31.

Compagnie de Saint-Gobain SA rose 0.18% to €34.06 after the mirror manufacturer said along with Trakya Cam, a subsidiary of the Sisecam Group, it signed a contract to create a joint venture owned 70% by Trakya Cam and 30% by Saint-Gobain.

The joint venture will focus on Russia and build a flat glass manufacturing and a magnetron coater line in the Alabuga special economic area of the Republic of Tatarstan.

Nobel Biocare Holding AG slumped 8.40% to Sfr17.12 after the Swiss medical devices company was downgraded by UBS AG.

Novartis AG gained 0.48% to $58.45 after the company agreed to continue their collaboration toward a world free of leprosy.

According to the agreement, Novartis will continue to provide free multidrug therapy medicines to all countries worldwide. The donation to the WHO, valued at around $26 million, will treat an estimated 1.1 million leprosy patients over the next five years, through 2015.

The ASSA ABLOY Group increased 0.24% to SEK 165.90 after the Swedish lock manufacturer signed a definitive agreement to acquire ActivIdentity.

The company noted that the offered price amounts to about $162 million with an offered share price of $3.25 per share representing a premium of around 48% over ActivIdentity average closing share price of $2.20 during the 20 trading days ending October 8.