4:00 PM Frankfurt – The European indexes fell after German consumer sentiment improved unexpectedly in January. French consumer spending climbed more-than-anticipated and Spain factory price inflation soared in December. Ericsson and Siemens net rose.
U.S. indexes declined after mixed corporate earnings and Asian markets traded mixed.
German banks are very optimistic about their lending over the next one year, according to Bundesbank’s bank lending survey released today.
The German central bank said the anticipated strong growth in new lending is due in part to the increased use of existing credit lines. By contrast, dampening effects continue to stem from repayments, particularly by larger corporations.
The German Industrial Association, or BDI, said it expects the economy to expand by 2.5% this year slower than 3.6% growth in 2010.
In Paris CAC 40 Index declined 2.68 or 0.07% to close at 4,030.53 and in Frankfurt DAX Index edged higher 15.46 or 0.22% to close at 7,083.23.
German Consumer Sentiment Improves, Construction Orders Rise
German consumer confidence is on the rise, according to a survey by market research company GfK. The GfK''s Consumer Climate Index was forecast to rise to 5.7 in February from a revised 5.5 in January. The improvement was largely due to a perceived greater willingness by shoppers to make major purchases, the research group said.
The GfK study was based on around 2,000 consumer interviews held during the past month.
New orders in Germany''s construction industry rose 0.5% annually in November, the Federal Statistics Office reported on Tuesday. Total revenues generated in the industry increased 6% from the previous year in November to nearly €8.9 billion.
There were 729,000 persons employed in the construction sector at the end of November, which was 2.1% or 15,000 higher than last year.
French Consumer Spending Climbs, Housing Starts Rise
French consumer spending increased more than expected in December, driven by higher car purchases, according to data released today.
Consumer spending rose 0.6% on a monthly basis in December, compared to a 2.7% growth in November. The increase in household spending was largely driven by higher car purchases, which grew 8.6% from the previous month.
Annually, consumer spending rose 0.4% in December.
French housing starts increased 15% annually in the three months to December, latest data from the Housing Ministry showed on Tuesday. During the same period, housing approvals rose 3.6%, the ministry said.
There was an increase of 16.8% in the new construction started. Construction of existing building increased 0.3%. Residential construction starts rose 12.1%.
On a seasonally adjusted basis, housing starts rose 2.4% on a monthly basis in December, while approvals fell 0.7%.
Spain PPI Surges
Spain''s factory price inflation rose at the strongest pace in over two years in December as energy costs soared, according to official data.