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GERMAN DAX, FRENCH 40 UP ON GDP FIGURES

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German and French indices on STOCK.com

GERMAN DAX, FRENCH 40 UP ON GDP FIGURES

Nov 14 2014, 9.27am GMT

STOCK.com

European figures show a slight rise on GDP giving volatility to German and French indices.

Germany has escaped recession as Europe’s strongest country reports prelim GDP q/q of 0.1%, up from -0.2%. The Federal Statistical Office (Destatis) commented that the German economy turned out to be stable in a difficult global economic environment. But expectations are receding for interest rates to rise. This is against a background of calls for more structural measures to assist the economy as recovery has now gone into near stagnation. This follows a European negative spending policy in place for nearly 12 years. According to the most recent calculations, the GDP had slightly decreased (–0.1%) in the second quarter of 2014 after the German economy had started the year with much momentum (+0.8% in the first quarter of 2014).

Highlights of the German data:

  • The latest positive figure has mainly been driven by consumptive contributions as households increased their final expenditure in the third quarter of 2014.
  • Foreign trade also supported the German economy.
  • The increase in exports was higher than that of imports. Consequently, the balance of exports and imports had a slightly positive effect on the GDP in a quarter-on-quarter comparison.
  • Gross fixed capital formation especially in machinery and equipment in the third quarter was considerably down on the previous quarter.
  • Gross fixed capital formation in construction decreased slightly.
  • In a year-on-year comparison, the German economy grew. The price-adjusted GDP in the third quarter of 2014 was up by 1.2% on the third quarter of 2013.

German DAX chart following figures up by 0.10%

German DAX on STOCK.COM

France also showed a slight jump in Prelim GDP q/q 0.3%, forecast at 0.1%, previous -0.1%.

Highlights of French GDP:

  • Households’ consumption expenditure kept increasing moderately (+0.2% after +0.3%).
  • General government expenditure increased by 0.8% in the last quarter (after +0.5%).
  • Total gross fixed capital formation (GFCF) went down again (–0.6% after –0.8%). Thus, final domestic demand (excluding inventory changes) was still going up and contributed for +0.2 points to GDP growth (after 0.1 points in Q2).
  • Exports recovered (+0.5% after –0.1%) while imports accelerated (+1.1% after +0.3%).
  • The foreign trade balance contributed negatively to activity (–0.2 points after –0.1 points in previous quarter) while changes in inventories contributed positively to GDP growth (+0.3 points after –0.1 points).

French 40 [CAX] index shows reaction of slight rises and volatility.

French 40 CAX on STOCK.com

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