European Markets Approach 3-week Highs, UK Auto Production Rebounded

Bridgette Randall
30 Mar, 2023
Frankfurt

European markets advanced for the third day in a row after investors looked beyond the recent banking crisis in the U.S. and Switzerland. 

Market indexes advanced on the hopes that the decline in energy prices will continue to weaken goods price inflation and policymakers may slow interest rate hikes. 

Spain's inflation fell sharply in March after electricity and fuel prices declined and the UK's automobile production rebounded after parts shortages eased. 

Italy's jobless rate held at 7.0% in February, matching the rate in January, the statistical office ISTAT said Thursday. 

 

Spain's Inflation Weakened In March 

Consumer price inflation  in Spain slowed at a slower pace in March after energy and fuel price fell, the statistical office INE reported Thursday. 

Consumer price inflation on an annual basis in March rose at 3.3%, slower than 6.0% in February and the prices rose at the slowest pace since August 2021. 

Core inflation, which excludes non-processed food and energy. eased slightly to 7.5% from 7.6% in February. 

On a monthly basis, overall consumer prices rose 0.4%, slower than 0.9% increase in February. 

The Bank of Spain has estimated EU harmonized inflation rate in Spain to drop to 3.7% in 2023 and weaken to 3.6% in 2024.   

 

UK Automobile Production Rebounded In February 

The UK automobile production in February rose 13.1% to 69.707 units after electronic chips and components shortages eased, the Society of Motor Manufacturers and Traders reported Thursday. 

Passenger car production for the home market increased 20.3% to 13,073 units and exports rose 11.5% to 56,634 units. 

Exports to international markets accounted for 81.2% of total production. 

  

Europe Indexes & Yields 

The DAX index increased 1.1% to 15,499.89, the CAC-40 index advanced 1.2% to 7,273.02 and the FTSE 100 index added 0.8% to 7,624.49. 

The yield on 10-year German Bunds rose to 2.32%, French bonds traded at 2.82%, the UK gilts at 3.46% and Italian bonds hovered near 4.14%. 

The euro advanced to $1.086, the British pound to $1.234 and the Swiss franc to 91.51 cents.  

Brent crude oil added 55 cents to $78.84 a barrel and the Dutch natural gas added 77 cents to Є43.57 a MWh. 

 

Europe Movers 

Resource stocks led the gainers after crude oil, copper and iron ore prices advanced. 

Shell Plc, BP Plc, Glencore, Antofagasta, and Anglo American increased between 1% and 3%. 

Vestas Wind Systems A/S added 5.0% to DKK 197.92 after the Danish wind turbine maker won a 1.31 GW onshore order in Brazil. 

Casa dos Ventos Energias Renovaveis S/A placed an order for 756 MW wind turbine order for Rio Grande do Norte (Serra do Tigre) and 554 MW Bahia (Babilônia Centro) orders to be commissioned by 2025. 

H & M Hennes & Mauritz AB surged 16.3% to DKK 142.88 after the apparel retailer reported a surprise operating profit in the quarter ending in February. 

Revenue in the fiscal first quarter increased 12% to SEK 54.8 billion and operating profit rose to SEK 725 million from SEK 458 million a year ago. 

Sellpy, the second-hand platform and an associated  company is consolidated into the H&M group from the first quarter resulting in a one-time gain SEK 999 million. 

After-tax net income in the fiscal first quarter increased to SEK 540 million compared to SEK 217 million and earnings per share rose to SEK 0.33 from SEK 0.13 a year ago. 

Moonpig Group Plc soared 14.7% to 130.30 pence after the online greeting card and gifting platform in the UK and the Netherlands reiterated its annual revenue and adjusted earnings outlook. 

The company estimated annual revenue for the financial year ending April remain "unchanged" at around £320 million. 

The company added adjusted operating earnings guidance for the year also "remain unchanged."