Europe Stocks Struggled and Bond Yields Advanced, German Trade Surplus Soared In August

Bridgette Randall
05 Oct, 2023
Frankfurt

European markets lacked direction and investors reviewed economic data in the Euro Area. 

Market indexes in Frankfurt, Paris and London struggled to advance after a slow of mixed economic data added to market anxieties linked to economic growth worries and interest rate uncertainties.

Bond yields in the region also stayed elevated and currencies traded near six month lows after the dollar indexes edged higher.  

Spain's industrial output declined for the fifth month in a row in August to 3.4% and fell 0.8% from the previous month, the statistical agency INE reported Thursday. 

French industrial production declined 0.3% from the previous month in August and from the downwardly revised 0.5% increase in July, the statistical agency INSEE reported Thursday. 

Industrial production decreased 0.5% from the previous month and reversed 2.5% increase in the previous month. 

 

German Trade Surplus Widened In August 

Germany's trade surplus widened to Є16.6 billion in August from Є15.9 billion in the previous month, DeStatis reported Thursday. 

Calendar and seasonally adjusted exports decreased 1.2% to Є127.9 billion, the lowest in five months, and imports fell 0.4% to Є111.4 billion, the lowest since January 2022, 

Exports declined 5.8% and imports fell 16.8% and trade surplus soared from Є4.3 billion or calendar and seasonally adjusted Є2 billion from a year ago. 

 In August 2023, calendar and seasonally adjusted goods worth Є69.6 billion were exported to the member states of the European Union and goods worth Є60 billion euros were imported from the region. 

Compared to July 2023, calendar and seasonally adjusted exports to EU countries fell by 1.5% and imports increased by 1.9%.

Most exports outside the European Union went to the United States and most imports came from the People's Republic of China. 

Exports to the United States fell 1.3% to Є13.3 billion, to China increased 1.2% to Є8.4 billion, and to the United Kingdom fell 4.2% to Є6.0 billion.

Imports from China declined 2.0% to Є13.0 billion, from the U.S fell 13.1% to Є7.6 billion and the U.K. dropped to Є3.0 billion. 

In nominal terms, not calendar and seasonally adjusted, August exports were Є121.8 billion euros and imports Є107.4 billion. 

Exports fell by 5.8% and imports declined 16.7% from a year ago. 

The unadjusted foreign trade surplus soared to Є14.4 billion from Є0.4 billion a year ago. 

 

Europe Indexes & Yields

The DAX index decreased 0.03% to 15,093.02, the CAC-40 index fell 0.04% to 6,994.09 and the FTSE 100 index rose 0.5% to 7,449.10.

The yield on 10-year German bonds increased to 2.94%, French bonds traded higher to 3.52%, the UK gilts edged up to 4.64% and Italian bonds rose to 4.93%.

The euro edged lower to a three-month low to $1.051, the British pound to $1.213 and the U.S. dollar fetched 91.58 Swiss cents.

Brent crude decreased $1.41 to $84.12 a barrel and the Dutch TTF natural gas edged lower by €1.12 to €37.22 per MWh.

 

Europe Stock Movers 

Imperial Bands Plc rose 3.8% to 1,640.50 pence after the cigarettes maker reaffirmed annual outlook and announced a $1.3 billion of stock repurchase plan. 

RM plc soared 0..7% to 59.40 pence after the supplier of technology to education sector agreed to sell its intellectual property for $2.2 million to Hilco Streambank. 

Thales SA decreased 0.3% to €128.25 after the defense technology company signed a contract with Polska Grupa Zbrojeniowa, a Polish arms holding company, for the delivery of multiple combat systems for the Polish Navy. 

Nordex SE 1.7% to €10.13 after the wind energy company received an order for 45 MW wind turbines from Enerfin, a renewable energy division of Elecnor Group, the Spanish engineering company. 

Alstom SA plunged 37% to €13.54 after the rail transportation company lowered its free cash flow target because of higher production costs and delays in new orders. 

SMA Solar Technology AG rose 10% to €61.60 after the company lifted its annual outlook citing improvements in its large scale and commercial divisions.