Europe midday: Investors shrug off German data; DAX and FTSE march on
By Frank Prenesti
Date: Wednesday 08 May 2024
(Sharecast News) - European shares extended gains at midday on Wednesday amid another dump of corporate earnings and a smaller-than-expected fall in German industrial output.
The pan-European Stoxx 600 was up 0.43% at 516.21, with all major regional bourses higher and Britain's FTSE 100 pushing to another intra-day record of 8,350.
Investors will be turning their attention to a rate decision from the Bank of England on Thursday, with economists backing no change. Eyes will be on BoE governor Andrew Bailey for any hint on when rates may start to come down.
In economic news, industrial output in Germany fell in March, according to data released on Wednesday by the Federal Statistical Office, Destatis, though it wasn't as big a drop as expected after figures for the previous month were revised lower.
Industrial production fell by 0.4% over the month, following a revised 1.7% increase in February, which was changed from the initial estimate of +2.1%. Nevertheless, economists were expecting a drop of 0.6% in March.
"European indices are on the rise once again this morning, with stocks within the region providing an ongoing theme of outperformance despite yesterdays mixed US session," said Scope Markets analyst Joshua Mahony.
"The return to negative growth for German industrial production means that this key indicator is now 12% lower that its 2017 peak."
"While we have seen recent signs of optimism over a potential bottoming out in the German manufacturing sector, the weakness evident in this week's industrial production and factory orders data serves to highlight the ongoing struggles they will face trying to turn this ship around."
For investors, there is little desire to wait for the German economy to turn a corner, with the DAX pushing up towards record highs once again today.
Brent crude fell below $83 a barrel after the American Petroleum Institute reported a weekly inventory build of 0.5m barrels against expectations of a 1.4m decline.
In equity news, shares in Anheuser-Busch Inbev rose more than 4%, after strong first-quarter results.
Shares in Guinness brewer Diageo were up on the sentiment and received a further boost when Tim Martin, boss of the UK pub chain Wetherspoons, said the famous Irish stout had now become a favourite among younger drinkers.
BP, Shell and Enel were all lower on the weaker oil price.
Reporting by Frank Prenesti for Sharecast.com
Email this article to a friend
or share it with one of these popular networks:
You are here: news
10 Lower Thames St,
London EC3R 6EN