Euro-zone Inflation Near 2-Year High; Total SA Net Soars

Arthi Gupta
29 Oct, 2010
New York City

The European indexes fell after euro area annual inflation accelerated in October and jobless rate reached the highest level since 1998. German retail sales fell in September. Hungary and Dutch PPI rose in September. Polish Central Bank raised growth outlook for 2010.

[R]4:45 PM Frankfurt – The European indexes fell after euro area annual inflation accelerated in October and jobless rate reached the highest level since 1998. German retail sales fell in September. Hungary and Dutch PPI rose in September. Polish Central Bank raised growth outlook for 2010.[/R]

U.S. stocks declined on weaker-than-expected economic data and Asian markets dropped despite higher earnings from banks in Japan, China, India and Australia.

Spanish unemployment rate fell below 20% threshold. Norway jobless rate remained flat in October.

European Union leaders agreed to make limited changes to the Lisbon Treaty to strengthen the economic governance of the 27-nation bloc and ward off future financial crises. The Lisbon Treaty forbids E.U. countries from directly bailing out member states.

Reports say leaders have agreed on a permanent fund to rescue euro-zone countries, while also agreeing on fines and other sanctions on countries that break debt or deficit limits in the future.

In Paris CAC 40 Index increased 18.22 or 0.48% to close at 3,853.06 and in Frankfurt DAX Index edged higher 24.43 or 0.37% to close at 6,619.71. For the week, the CAC 40 Index fell 0.3% and the DAX Index decreased 0.36%.

The euro area unemployment rate rose to 10.1% in September from 10% in August, according to data published by Eurostat today. The unemployment was 9.8% in September 2009. Compared with August, the number of unemployed persons increased by 67,000 in September.

The EU27 unemployment rate was 9.6% in September, unchanged compared with August. A year ago in the month the jobless rate was 9.3%.

Consumer prices in the euro-zone rose 1.9% on an annual basis in October, versus the 1.8% rate in September, Eurostat said today.

German retail sales dropped a seasonally and calendar adjusted 2.3% in real terms in September, following a 0.4% fall in August, the Federal Statistics Office said today.

Annually, retail turnover recorded a real growth of 0.4% in September, as against a 3.1% increase in August, revised from 2.2% rise estimated initially.

Spain''s unemployment rate fell below the 20%-mark between July and September, official figures showed. Statistics office INE said the unemployment rate was 19.8% during the quarter, down from 20.1% in the June quarter. The number of unemployed fell by 70,800 to 4.6 million.

Switzerland''s KOF Institute''s economic barometer dropped to 2.17 points in October from September''s revised 2.20, according to data released by the institute today.

Hungary''s annual producer price index rose 7.9% in September, versus a 9% growth in August. Producer prices for manufacturing grew 6.4% annually in September, following a 7.1% rise in August.

On a monthly basis, the PPI decreased 0.9% in September, following a 0.2% fall in August. Producer prices for manufacturing industry slipped 0.6% in September.

Dutch producer price index rose 8.8% on an annual basis in September, compared to a 7.6% rise in August, the statistics office said today. Producer prices in August was revised from 7.7% rise estimated initially. A year earlier, the PPI decreased 12.5%.

On a monthly basis, producer prices rose 0.5% in September, following a 0.1% rise in August. Prices on the domestic market grew 0.7%.

Inflation in Italy rose to 1.7% in October from 1.6% in September, according to Istat''s preliminary estimate. On a monthly basis, consumer prices increased 0.2% in October, reversing a 0.2% fall in September.

Italy''s seasonally adjusted jobless rate rose to 8.3% in September from 8.2% in August. The number of job seekers rose 1.1% annually in September while on a monthly basis; the rate of increase was 2.1% in September.

Norway''s unemployment rate remained stable at 2.7% in October compared to 2.8% recorded in September, Norwegian Labor and Welfare Service, or NAV, said today. As many as 69,790 unemployed persons registered with NAV during October, down from 71,431 registered in September.

The Polish central bank lifted the growth outlook for the economy this year on the back of robust domestic demand. The Narodowy Bank Polski forecast 3.5% growth this year, higher than the 3.2% estimated in June. Stronger growth this year will be accompanied by higher domestic demand, the central bank said in its quarterly inflation report.

Gainers & Losers

AstraZeneca plc fell 0.98% to $50.43 after the biopharmaceutical company announced an agreement with Daiichi Sankyo for the co-promotion and supply of NEXIUM, a proton pump inhibitor, in Japan.

British Airways plc fell 2.67% to 273.20 pence after the airline reported first-half profit of £107 million or 7.9 pence per share, compared to a loss of £217 million or 18.8 pence per share last year.

Ferrovial, S.A. soared 3.39% to €8.20 after the infrastructure group generated net profit of €315 million in the nine months to September versus a €191 million loss a year earlier.

Sandvik AB plunged 4.85% to SEK 100.10 after the Sweden-based engineering company reported third quarter revenue grew 22% to SEK 20.24 billion from SEK 16.58 billion last year. Profit attributable to owners was SEK 1.58 billion, compared to loss of SEK 181 million last year. Earnings per share before dilution was SEK 1.33, compared to loss per share of SEK 0.15 in the prior-year quarter.

Sanofi-Aventis S.A. gained 1.19% to $34.79 after the diversified pharmaceutical company agreed to buy BMP Sunstone Corp., which sells medicine in China, for $520.6 million.

Seche Environnement S.A advanced 2.48% to €57.74 after the waste-management services firm raised its full-year sales target for the current financial year.

Total S.A. climbed 1.59% to $54.40 after the French oil major reported third quarter sales grew 19% to €40.18 billion from €33.63 billion in the same quarter last year. Net income in the quarter increased 45% to €2.88 billion or 1.26 euros per share from €1.98 billion or 0.86 euros per share in the previous year, helped by higher oil and gas prices as well as improved production.