European Markets Struggled, Euro Area Trade Deficit Shrank and German Wholesale Inflation Declined

Bridgette Randall
16 Oct, 2023
Frankfurt

Stocks across Europe struggled and market indexes traded near flatline in Monday's trading. 

Benchmark indexes In London, Paris and Frankfurt struggled to gain traction and bond yields advanced in the region. 

Investors turned cautious on the worries of  higher interest rates, looming global economic slowdown and impending Israel's invasion in Gaza as early as this week. 

Natural gas prices stayed elevated on the supply worries after Israel asked Chevron to halt natural gas production at fields located near its northern shores. 

Closer to home, German wholesale prices dropped for the sixth month in a row and declined 4.1% in September, following a 2.7% decline in August, the Federal Statistics office or Destatis reported Monday. 

The measure of wholesale price declined after petroleum products prices eased from a higher price base in the month a year ago. 

 

Euro Area Goods Trade Balance Swung to Surplus 

The Euro Area goods trade balance swung to a surplus of Є6.7 billion in August from a Є54.4 billion deficit in the month a year ago. 

Exports declined 3.9% to Є221.6 billion and imports plunged 24.6% to Є214.9 billion.

In the first eight months of the year, international trade deficit declined to Є9.8 billion from Є311.4 billion and the surplus with the U.S. rose to Є100.2 billion from Є98.3 billion in the corresponding period a year ago. 

 

Europe Indexes & Yields

The DAX index increased 0.08% to 15,198.75, the CAC-40 index rose 0.2% to 7,015.60 and the FTSE 100 index added 0.4% to 7,630.60.

In the week, the DAX index increased 1.1%, the CAC-40 index advanced 0.8% and the FTSE 100 index edged higher 1.4%. 

The yield on 10-year German bonds decreased to 2.79%, French bonds traded higher to 3.42%, the UK gilts edged up to 4.47% and Italian bonds rose to 4.87%.

The euro edged lower to a three-month low to $1.053, the British pound to $1.215 and the U.S. dollar fetched 90.24 Swiss cents.

Brent crude increased $0.17 to $90.78 a barrel and the Dutch TTF natural gas edged higher by €2.74 to €51.24 per MWh.

 

Europe Stock Movers

Resource stocks were in focus on the hopes that demand growth from China would recover after the People's Bank of China offered additional liquidity to the banking system. 

Anglo America, Glencore and Antofagasta advanced between 1% and 2% after base metal prices advanced. 

BioNTech SE dropped 7.7% to €93.14 after the German biotech company said it plans to take a one-time charge to write-down assets worth €900 million in the third quarter. 

GSK Plc declined 1.2% to 1,491.60 pence despite the European Medicines Agency's drug approval committee offering a positive view on its intravenous cancer treatment therapy Jemperli.