German Industrial Production Rises 0.2%, Record Italian Jobless Rate

Barry Randall
09 Jan, 2013
New York City

European markets advanced across the region and Germany reported weaker than expected increase in industrial output. Italian unemployment held steady at record in November. ArcelorMittal plan to raise $3.5 billion through stock and convertible bond offering.

[R]4:00 PM Frankfurt – European markets advanced across the region and Germany reported weaker than expected increase in industrial output. Italian unemployment held steady at record in November. ArcelorMittal plan to raise $3.5 billion through stock and convertible bond offering.[/R]

European markets traded higher on the hopes of higher corporate earnings. Of the 17 largest markets in Western Europe, sixteen advanced.

In London trading, FTSE 100 index added 21 or 0.3% to 6,075 and Frankfurt DAX gained 14.8 or 0.2% to 7,711. In Paris, CAC 40 index advanced 0.2% or 8.6 to 3,715.

Italian Unemployment Rate Holds Near Record

Italy reported jobless rate in November stayed near record high and youth unemployment soared to a new high of 37%.

Unemployment rate in November was steady and matched the record high of 11.1% in October, according to the statistics bureau ISTAT.

The unemployment rate increased above 11% for the first time since the first quarter of 1999.

The November rate was 1.8 percentage point higher from a year ago month unemployment rate.

German Industrial Production Rises 0.2%

German industrial output increased less than expected in November.

The Economy Ministry said industrial output increased 0.2% in the month far less than 1% what most economists had anticipated. Energy output declined 3.3% and consumer goods production fell 2.2%.

The ministry also estimated economic growth declined to 0.8% in 2012 after expanding 3% in 2011 and 4.2% in 2010.

Separately, DIW economic research institute said domestic consumption will drive the economic growth and economy is expected to grow 0.9% in 2013 and accelerate to 2% in 2014 from the previous estimate of 1.6%.

Stocks in Review

ArcelorMittal ((MT)) dropped 4% to €12.85 after the steelmaker said it plans to raise $3.5 billion through the sale of stocks and convertible notes to lower total debt load of $17 billion.

Telecom stocks jumped on the speculation that the companies may be allowed to share wireless infrastructure to lower operating costs.

Telecom Italia jumped 7% to 74.4 cents, France Telecom gained 5% to €8.75 and Deutsche Telekom added 2.8% to €9.05.

Shire Plc, the Irish drug maker soared 2% to 2,0007 pence after it reaffirmed its full year outlook and said it estimates “double digit” earnings growth in 2012.

Galapagos NV soared 4% to €17.95 after the Belgian drug maker announced in a statement it anticipates to receiving a milestone payment for a new drug development alliance from GlaxoSmithKline Plc after it delivered fifth pre-clinical drug candidate.

J Sainsbury Plc declined 2% to 331.6 pence after the third largest supermarket in UK reported said comparable same store sales excluding fuel increased 0.9% for the 14 weeks to Jan 5, the weakest gain in eight years.

Delta Llyod soared 6% to €13.70 after Aviva sold its 19.4% stake in the Dutch company for €433.8 million. Aviva, the UK based insurance company declined 2.5% to 372 pence.