Euro Zone Inflation Stable, UK Retail Sales Rise

Arthi Gupta
16 Aug, 2012
New York City

The European indexes traded lower awaiting central bank action. German employment rose in the second quarter, the UK retail sales rose unexpectedly and euro zone annual inflation was stable in July. Telekom Austria earnings rose in the second quarter.

[R]1:45 PM Frankfurt – The European indexes traded lower awaiting central bank action. German employment rose in the second quarter, the UK retail sales rose unexpectedly and euro zone annual inflation was stable in July. Telekom Austria earnings rose in the second quarter.[/R]

European indexes edged lower in slow trading across the region as most traders and leaders stay away for holiday and await action from central banks.

In economic news, euro zone annual inflation remained stable at 2.4% in July and Switzerland’s economic confidence climbed in August.

In earnings news, Zurich Insurance net rose 13% and SBM Offshore swung to profit in the first-half.

In Paris trading, the CAC-40 Index declined 1.23 or 0.04% to 3,447.97 and in Frankfurt the DAX Index edged higher 3.63 or 0.1% to 6,950.98.

The yields on Spain’s benchmark 10-year bonds rose five basis points to 6.69%. Italian 10-year yields climbed 10 basis points to 5.87%.

Euro zone Inflation Stable

Euro zone annual inflation remained stable at 2.4% in July, final data from Eurostat showed. A year earlier the rate was 2.6% in July and on a monthly basis, consumer prices fell 0.5% in the month.

Core inflation that excludes energy, food, alcohol and tobacco, increased to 1.7% annually in July from 1.6% a month ago.

EU annual inflation was 2.5% in July 2012, also stable compared to June. A year earlier the rate was 2.9%.

German Employment Climbs

German employment rose in the second quarter, preliminary data from the Federal Statistics Office showed.

The number of persons in employment, whose place of employment is in Germany, increased 1.3% or 514,000 people on an annual basis to 41.6 million in the second quarter compared to the 1.4% gain recorded in the first quarter.

The average number of hours worked per person in employment decreased 0.3% annually to 331.8 hours in the second quarter, data showed.

Dutch Unemployment Soars

The number of jobless persons in the Netherlands, on a seasonally adjusted basis, increased to around 510,000 in July from about 495,000 in June, data released by the Central Bureau of Statistics showed.

UK Retail Sales Rise

The UK retail sales grew 0.3% from a month ago in July after rising 0.8% in June, data from the Office for National Statistics showed today.

On a yearly basis, sales volume rose 2.8% in July from the 2.6% growth in June.

Swiss Confidence Strengthens

Switzerland’s economic confidence climbed in August, data from a survey by Credit Suisse and the Center for European Economic Research showed.

The headline index increased to -33.3 points in August from a revised -42.5 points in July.

Gainers & Losers

Basilea Pharmaceutica AG rose 1.1% to Sfr50.70 after the biopharmaceutical company reported first-half sales grew to Sfr17.7 million from Sfr15 million in the prior-year period. Net loss widened to Sfr34.6 million or Sfr3.61 per share compared to a net loss of Sfr20.2 million or Sfr2.10 per share last year.

Mayr-Melnhof Karton AG fell 1.8% to €72.62 after the carton board manufacturer reported first-half consolidated sales decreased 1.3% to €975.0 million from the prior year. Profit for the period declined 20% to €51.2 million compared to €64.0 million last year.

SBM Offshore N.V. gained 0.1% to €10.89 after the offshore energy systems provider reported first-half revenues grew 14% to $1.67 billion. Net profit generated in the period was $156.85 million or 91 cents per diluted share compared to a net loss of $265.33 million or $1.57 per share in the previous year.

Telekom Austria AG plunged 4.9% to €7 after the telecommunications provider reported second quarter operating revenues fell 4.2% to €1.06 billion from the prior-year quarter. Profit attributable to owners gained to €34 million or 8 cents per share from €19.9 million or 5 cents per share a year ago.

Zurich Insurance Group AG dipped 0.04% to Sfr226.10 after the insurer reported second quarter net income attributable to shareholders fell 19% to $1.08 billion from $1.33 billion last year. Total group business volumes rose 4% to $17.87 billion.