European Markets React to Fall in German Exports and Elevated Producer Prices

Bridgette Randall
04 Jul, 2022
New York City

European markets advanced and Germany's trade balance swung to a loss in May on a surprise decline in exports. 

The DAX index fell 0.3% to 12,773.38, the CAC-40 rose 0.4% to 5,954.65, and the FTSE 100 index increased 0.9% to 7,232.65. 

Financial markets in the U.S. are closed to celebrate the Independence Day holiday. 

German exports declined 0.5% in May on a monthly basis from April and imports rose 2.7% after adjusting for calendar and seasonal factors, the Federal Statistics Office or Destatis said on Monday. 

From a year ago, exports rose 11.7% in May and imports advanced 27.8%. 

Highlighting how hard it is to wean away from trading with Russia, exports to the Russian Federation rose 29.4% to 1.0 billion euros in May from April but fell 54.6% from a year ago. 

Imports  from Russia declined 9.8% to 3.3 billion euros in May from April. 

Eurozone producer prices eased to 36.3% in May from a record high 37.2 in April, eurostat, the statistical office of the European Union, reported on Monday. 

Producer prices rose 36.4% in the European Union. 

Price increase also slowed on a monthly basis. industrial producer prices rose 0.7% in the euro area and 0.8% in the EU, compared with April. 

Inflation in Turkey accelerated to a record high in June primarily driven by transportation prices and surged to levels last seen in 1998. 

The consumer prices index soared 78.62% in June on an annual basis from a 73.5% increase in May, the Turkish Statistical Institute reported on Monday. 

Consumer prices on a monthly basis rose 4.95% in June from May. 

Domestic producer price inflation increased to 138.31% in June from 132.16% in May, a separate report from the statistical office showed. 

Resource stocks closed higher after futures of crude oil increased 2.3% to $113.83 a barrel on tight global oil supply. 

Shell Plc, TotalEnergies, and BP Plc gained between 4% and 5%. 

The discount airlines Ryanair and Wizz Air were on the defensive and dropped as much as 2% after releasing June passenger traffic data. 

Airbus SE declined 1.9% to 93.40 euros and the company signed orders to deliver 292 A320 airplanes to several China-based airlines including Air China, China Eastern, China Southern, and Shenzhen Airlines.

Tesco plc gained 1.1% to 257.68 after the retailer commenced its share repurchase program. 

Spirax-Sarco rose 0.8% to 10,130.0 pence after the valve maker entered in exclusive negotiations with Qualium to acquire Vulcanic Group for 262 million euros on a cash and debt free basis.