Eurozone Retail Sales Extends Fall to Sixteenth Month, German Trade Surplus Jumps to Record January High

Bridgette Randall
06 Mar, 2024
Frankfurt

Stock market indexes in Europe edged higher, and investors reviewed the latest economic updates and awaited the release of the UK's general budget. 

Benchmark indexes in Frankfurt, Paris, and London inched higher ahead of the European Central Bank's rate decisions on Thursday.

 

Eurozone Retail Sales Barely Advanced in January 

Retail sales in the eurozone increased by 0.1% in January from the previous month, following a revised 0.6% contraction in December, Eurostat reported Wednesday. 

Retail sales adjusted for the calendar decreased 1.0% from a year ago, and fell for the sixteenth month in a row. 

Volume of food, drinks, and tobacco from a year ago declined by 0.6%, automotive fuel increased by 0.8%, and nonfood products declined by 1.4%. 

 

German Trade Surplus Expands to Record High In January 

German exports rose faster than imports, driving the trade surplus to a record high in January, indicating a strong demand for German goods. 

Exports rose 6.3% monthly and edged up 0.3% annually to €135.6 billion, and imports rose 3.6% monthly but dropped 8.3% annually to €108 billion. 

Most German exports were shipped to the U.S., followed by transactions with the People's Republic of China and the U.K. 

Exports to the U.S. decreased 1.7% monthly to 12.5 billion, to China increased 7.8% to 8.1 billion, and to the U.K. decreased 8.1% to 6.8 billion. 

Meanwhile, most imports arrived from China, followed by shipments from the U.S. and the U.K. 

Imports from China decreased 11.1% to €10.4 billion, from the U.S. fell 5.2% to €7.8 billion, and from the U.K. increased 18.4% to €3.1 billion. 

Calendar and seasonally adjusted goods exports to the European Union member states increased 8.9% to €75.8 billion, and imports rose 10.8% to €61.2 billion. 

The goods trade surplus in January widened to €27.5 billion from €23.3 billion in December and €16.9 billion a year ago. 

 

Europe Indexes and Yields

The DAX index increased by 0.2% to 17,744.54, the CAC-40 index rose by 0.3% to 7,955.50, and the FTSE 100 index inched higher by 0.3% to 7,668.28.

The yield on 10-year German bonds edged down to 2.35%; French bonds inched lower to 2.81%; the UK gilts edged lower to 4.05%; and Italian bonds inched lower to 3.72%.

The euro edged higher to $1.087, the British pound inched higher to $1.272, and the U.S. dollar weakened to 88.45 Swiss cents.

Brent crude increased $0.45 to $82.50 a barrel, and the Dutch TTF natural gas increased by €0.92 to €28.39 per MWh.

 

Europe Stock Movers

Legal & General Group declined 2.2% to 239.91 pence after the UK-based insurance company reported flat operating profit in 2023. 

DS Smith increased 0.5% to 321.90 pence after the paperboard and packaging company reported better-than-expected fiscal third quarter profit and the company estimated a positive outlook in the current quarter. 

Deutsche Post declined 5.8% to €39.27 after the parent company of DHL cautioned against flat annual earnings in the current fiscal year. 

Symrise advanced 4.9% to €100.90 after the German flavor and fragrance company reported a better-than-expected core annual profit in 2023. 

Tullow Oil fell 0.5% to 28.11 pence after the independent energy company reported a decline in pre-tax profit on lower crude oil prices and impairment charges. 

Total revenue in 2023 declined to $1.6 billion from $1.8 billion, net income from continuing activities swung to a loss of $110 million from a profit of $49 million, and basic earnings per share were 7.6 cents a loss compared to 3.4 cents a profit a year ago. 

Energy production in the quarter increased to 55,754 from 55,170, but the realized oil price fell to $77.50 from $88.0 a year ago.