European Markets Mixed, Faster Decline in Imports Drives German Trade Surplus Higher

Bridgette Randall
05 Feb, 2024
Frankfurt

European markets trended lower in Monday's trading, and investors reviewed the latest update on the eurozone service sector and German international trade data.

The service sector in the eurozone showed a slight decrease, and the PMI index eased to 48.4 in January from 48.8 in December, according to the data released by S&P Global on Monday.

In other economic news in the region, the service sector in Italy expanded for the sixth month in a row and in Spain for the fifth month in a row in January.

Crude oil traded volatile after the price of the commodity was under pressure following the rise in the dollar and ongoing demand growth worries in China.

 

German Trade Surplus Expands in December

Germany's exports and imports declined in December, but trade surplus rose for the fourth month in a row, the Federal Statistics Office, or Destatis, reported Monday.

Seasonally adjusted exports declined 4.6% from the previous month to €125.3 billion in December, and imports fell 6.7% to €103.1 billion.

From a year ago, exports fell 4.6% and imports dropped 12.4%, reflecting a weakness in non-EU demand and a sharp fall in energy import prices.

In the year 2023, exports decreased 1.4% to €1.56 trillion and imports plunged 9.7% to €1.35 trillion, resulting in a trade surplus of €209.6 billion.

In December, exports to the EU-member nations fell 5.5% to €67.5 billion and to the non-EU nations decreased 3.5% to €57.8 billion.

The shipments to the U.S. led all other nations and declined by 5.5% in December to €12.7 billion, followed by a decline of 7.9% to €7.5 billion to China and a fall of 4.3% to €7.4 billion to the U.K.

Imports from the People's Republic of China led all incoming goods arrivals and declined 8.5% to €11.6 billion, followed by a 1.9% decline to €8.2 billion from the U.S. and a fall of 10% to €2.6 billion from the U.K.

 

Europe Indexes and Yields

The DAX index decreased 0.1% to 16,902.94, the CAC-40 index fell 0.2% to 7,579.41, and the FTSE 100 index inched higher by 0.1% to 7,624.42.

The yield on 10-year German bonds edged up to 2.28%; French bonds inched higher to 2.78%; the UK gilts edged lower to 3.98%; and Italian bonds inched lower to 3.84%.

The euro edged lower to $1.075, the British pound inched higher to $1.260, and the U.S. dollar gained to 87.0 Swiss cents.

Brent crude decreased $0.36 to $76.96 a barrel, and the Dutch TTF natural gas decreased by €0.44 to €28.86 per MWh.

 

Europe Stock Movers

UniCredit SpA soared 10% to €29.36 after the largest Italian bank reported higher-than-expected profit and announced its plan to increase shareholder payout.

CMC Markets PLC soared 15% to 152.84 pence after the online trading platform announced its plan to cut 200 jobs to reduce its overall operating costs.

Vodafone Group fell 0.5% to 68.25 pence, despite the wireless telecom operator reporting higher-than-expected sales in the fiscal third quarter.

Societe Generale declined 0.6% to €22.97 after the French lender announced organization changes at its headquarters that would lead to 900 voluntary departures.