European Commission Revised Higher Euro Area Growth Estimate

Bridgette Randall
13 Feb, 2023
Frankfurt

European markets closed higher as investors weighed risks of economic slowdown and interest rate hike amounts. 

The U.S. consumer price index is scheduled to be released on Tuesday and economists are estimating the measure of inflation for January to to hold steady from the previous month. 

The European Commission also revised higher its assessment of economic growth in 2023 by 0.6 percentage point to 0.9%. 

The commission revised its growth estimate following the weakening of natural prices below the pre-war level and the labor market has held up despite the adverse conditions.  

The commission also revised lower its inflation projections for 2023 to 5.6% and 2024 to 2.5%, decelerating from 8.4% in 2022. 

The commission also revised higher its economic growth estimate to 0.8% for the European Union. 

The DAX index increased 0.6% to 15,397.34, the CAC-40 index rose 1.1% to 7,208.59 and the FTSE 100 index closed up 0.8% to 7,947.60.

The euro inched up to $1.07, the British pound closed up 1.21% and the Swiss franc closed unchanged at 91.97 U.S cents. 

Brent crude fell 68 cents to $85.70 a barrel and the Dutch TTF natural gas fell 4% to Є51.71 per MWh. 

The yield on 10-year German Bunds increased to 2.36%, French bonds increased to 2.81%, the UK Gilts to 3.4% and Italian bonds to 4.14%. 

 

Europe Movers 

French automaker Renault SA increased 1.4% to €41.54 after the company and its Japanese partner Nissan Motor plan to invest $600 million in India and to manufacture six models including two electric vehicles. 

Lok'nStore Group decreased 3.5% to 929.0 pence despite the UK-based self-storage company saying revenue in the first-half increased 10.3%. 

The company said operating costs and construction costs are also increasing at a faster pace and added these increases are expected to "return to a more normalized level in due course."

Brickability Group jumped 8.9% to 74.80 pence after the UK construction company confirmed that current year profits are likely to surpass market expectations. 

The company revised higher its estimate of adjusted EBITDA profit to at least £47 million, ahead of market expectation of £44.7 million. 

Homebuilders fell in London trading after Deutsche Bank lowered its rating on leading companies in the sector. 

Barratt Developments PLC declined 1.3% to 463.09 pence and Taylor Wimpey plc decreased 2.8% to 118.25 pence. 

Castellum AB declined 5.7% to SEK 138.35 after the company confirmed its plan to complete its rights offering plan to raise SEK 10 billion.