Eurozone Bond Yields Eased to One-Month Low, Swiss Goods Trade Surplus Soared In October

Bridgette Randall
19 Nov, 2024
London

Stock market indexes across Europe looked down, bond yields headed lower, and the euro and the pound drifted lower against the U.S. dollar. 

Benchmark indexes in Paris, Milan, Frankfurt, and London declined as investors worried about escalating tensions between Russia and Ukraine. 

Investors sought safety in bonds amid worries of supply chain disruptions and a potential deepening of  conflict between Russia and Ukraine. 

Bond yields edged lower after Russia's president, Vladimir Putin, pledged to use atomic weapons in the event the nation is attacked by massive conventional weapons.

Moreover, the European Central Bank officials also signaled a dovish outlook for the future rate path, suggesting that rate cuts at the next policy meeting are less likely.

 

Chemical and Pharma Exports Growth Drives Swiss Trade Surplus to Record High in October 

On the economic front, Switzerland's goods trade surplus soared to a record high of CHF 6 billion, up from the revised CHF 4.0 billion in September, according to a monthly update released by the Federal Customs Administration. 

On a monthly basis, seasonally adjusted exports surged 10.2% to CHF 24.4 billion, driven by sharply higher sales of jewelry & watches, vehicles, and pharmaceuticals and chemicals. 

Meanwhile, imports advanced 1.8% from the previous month to CHF 18.4 billion, with increases in chemical and pharmaceutical products, jewelry, and paper and graphic products. 

Chemical and pharmaceutical exports jumped 15.6% to CHF 14.3 billion from CHF 12.3 billion; advanced electrical machinery rose 3.1% to CHF 2.7 billion from CHF 2.6 billion; and watches advanced 5.1% to CHF 2.1 billion from CHF 2.0 billion. 

Between January and October 2024, international trade balance increased to CHF 39.5 billion, compared to CHF 31.8 billion in the same period in 2023. 

 

Europe Indexes and Yields

The DAX index decreased by 1.1% to 18,967.02; the CAC-40 index eased by 1.2% to 7,192.02; and the FTSE 100 index fell by 0.4% to 8,081.54.

The yield on 10-year German bonds edged lower to 2.31%, French bonds inched down to 3.05%, the UK gilts edged lower to 4.42%, and Italian bonds decreased to 3.53%.

The euro edged lower to $1.05; the British pound inched down to $1.26; and the U.S. dollar strengthened to 88.27 Swiss cents.

Brent crude decreased $0.41 to $72.88 a barrel, and the Dutch TTF natural gas rose by €0.05 to €47.18 per MWh. 

 

Europe Stock Movers

ThyssenKrupp AG increased 8.1% to €3.67 after the German steelmaker reported slightly better-than-expected earnings. 

Sales in the fiscal year 2024 ending in September declined 7% to €35 billion, and adjusted operating earnings declined to €567 million from €703 million a year earlier, respectively. 

The company estimated net income to swing to €100 million from a loss of €1.4 billion in the financial year that just ended. 

Net loss in the fiscal year 2024 shrank to €1.4 billion from €2.0 billion the prior year, driven by asset impairment of €1.2 billion in its steel division in Europe. 

The company proposed to pay an annual dividend of 15 cents per share and return cash to shareholders for the third year in a row. 

Nestle SA declined 1.8% to CHF 76.78 after the company said it plans to accelerate its cost savings by CHF 2.5 billion and support additional investments. 

Caixabank SA decreased 4.8% to €5.42 after the company released its 2025-2027 strategic plan.