European Markets Turn Lower Despite Banks, Industrial and Travel Companies Report Positive Results

Bridgette Randall
25 Apr, 2023
Frankfurt

European markets lacked direction for the third day in a row and investors digested a slew of earnings announcements. 

Banks were in focus after Spain-based Santander reported better-than-expected quarterly results but the Switzerland-based UBS reported a sharp decline in earnings. 

Novartis, Associated British Foods, Whitbread and Daimler Truck were among the leading European companies reporting better-than-expected quarterly results. 

Despite the improving quarterly results from European companies, benchmark indexes trended lower on the worries of future rate hikes and slowing economic activities. 

 

UK Government Debt Expanded In March 

The UK government's borrowing increased by £21.53 billion in March of 2023, higher than £16.3 billion in the month a year ago, the Office for National Statistics reported Tuesday. 

The UK government's receipts rose 2.3% to £88.8 billion and spending advanced 19.9% to £110.3 billion, reflecting a surge in energy subsidies by £8.0 billion to households and businesses. 

Over the twelve months to March 2023, borrowing increased to £139.2 billion or 5.5% of the GDP, £18.1 billion more than in the previous 12 month period and the fourth-highest borrowing since records began in 1946. 

 

Indexes & Yields 

The DAX index index decreased 0.1% to 15,845.31, the CAC-40 index declined 0.6% to 7,524.88 and the FTSE 100 index dropped 0.3% to 7,886.04. 

The yield on 10-year German Bunds eased to 2.44%, French bonds to 3.00%, the UK gilts to 3.73% and Italian bonds to 4.32%. 

The euro weakened to $1.10, the British pound to $1.24 and the Swiss franc to 88.69 cents. 

Brent crude oil decreased 32 cents to $82.40 a barrel and the Dutch TTF natural gas eased 38 cents to Є39.55 per MWh. 

 

Europe Stock Movers 

Alstom SA increased 1.1% to €21.92 after the French company won an €900 million order to supply trams to Quebec City, Canada. 

UBS Group AG decreased 1.9% to CHF 17.85 after the Swiss bank reported a 52% fall in its first quarter earnings, reflecting higher provision for U.S. litigation and weaker sales.  

ABB Ltd advanced 3.2% to CHF 32.69 after the Swiss engineering and construction company raised its full-year 2023 sales and earnings outlook. 

Jungheinrich AG soared 10.4% to €33.66 after the German forklift maker reported higher first quarter operating earnings and the company also lifted its full-year outlook. 

Daimler Truck Holding AG added 2.5% to €30.71 after the German heavy duty vehicle maker reported better-than-expected earnings. 

Novartis AG rose 2.7% to CHF 91.92 after the Swiss drug maker lifted its full-year 2023 outlook. 

Nestle SA advanced 1.1% to CHF 115.96 after the Swiss food products maker posted better-than-expected first quarter sales. 

Associated British Foods Plc decreased 3.4% to 2,001.0 pence after the owner of Primark reported a 3% decline in first-half profit. 

Ocado Group Plc advanced 1.4% to  512.80 pence after the online grocery company said it plans to stop operation at its Hatfield customer fulfillment center, impacting about 2,300 staff. 

Whitbread Plc soared 5.6% to 3,302.66 pence after the parent of Premier Inn after the company said its annual income surpassed pre-pandemic levels.