German stocks stumble on downbeat data

German stocks stumble on downbeat data

Frankfurt Stock Exchange
The German share price index, DAX board, is seen at the stock exchange in Frankfurt, Germany. (REUTERS/Tilman Blasshofer)

LONDON: German stocks underperformed on Tuesday (May 15) on downbeat economic data while modest gains on Europe's other main stock markets were pared by a weaker Wall Street, dealers said.

Frankfurt was showing a loss of 0.2 per cent by the close, as disappointment over Thyssenkrupp and Merck results also weighed.

Both London and Paris were fractionally higher at the closing bell.

In New York the benchmark Dow index was lower approaching midday, having opened lower for the first tine in nine sessions as inflation fears returned to the market.

'TEMPORARY EFFECTS'

In Germany, Europe's biggest economy, growth came out at a disappointing 0.3 per cent in the first quarter, half the pace of the preceding three months, new data showed.

And adding to the gloom was a widely watched index of investor confidence, which stood at its lowest level since November 2012.

Meanwhile, growth in the 19-country eurozone as a whole stood at 0.4 per cent in the January-March period, down from 0.7 per cent in the previous quarter, the EU's Eurostat statistics agency calculated.

Analysts nevertheless were confident that the disappointing data would prove only short-lived.

"We think that the slowdown in eurozone GDP growth largely reflected temporary effects," said Capital Economics analyst Jack Allen.

"What's more, unseasonably-bad weather hindered construction activity and retail sales, which was only partly offset by an associated increase in energy output.

"Overall, we think that without those effects, the eurozone economy might have grown by about 0.6 per cent in the first quarter."

"Equity markets in Europe are experiencing low volatility today, as the outlook for the region remains unchanged," said CMC Markets analyst David Madden.

ASIA SLIDES

In Asia on Tuesday, stock markets mostly fell as trade issues returned to the spotlight with China and the US holding more high-level talks this week.

A run-up in equities over the past week has also led to profit-taking, with Hong Kong hit after six straight days of gains.

Chinese Vice Premier Liu He - President Xi Jinping's right-hand man on economic issues - headed to Washington on Tuesday for a new round of talks aimed at heading off a trade war between the economic giants.

There are hopes the two sides can hammer out an agreement to end a dispute that has seen both sides threaten tariffs on billions of dollars of goods.

Donald Trump's call to help get Chinese telecom equipment manufacturer ZTE "back into business fast" soothed nerves, while Commerce Secretary Wilbur Ross said Monday he was exploring "alternative remedies" for the firm, which was in April banned from buying crucial US technology for seven years.

Concerns about the crude-rich Middle East region have helped put upward pressure on oil prices, with deadly clashes in Gaza during the opening of the US embassy in Jerusalem coming less than a week after Trump ripped up the Iran nuclear deal.

Key figures around 1540 GMT:

New York - Dow: DOWN 0.8 per cent at 24,703.62 points

London - FTSE 100: UP 0.2 per cent at 7,722.98 (close)

Frankfurt - DAX 30: DOWN 0.1 per cent at 12,970.04 (close)

Paris - CAC 40: UP 0.2 per cent at 5,553.16 (close)

EURO STOXX 50: FLAT at 3,564.38

Tokyo - Nikkei 225: DOWN 0.2 per cent at 22,818.02 (close)

Hong Kong - Hang Seng: DOWN 1.2 per cent at 31,152.03 (close)

Shanghai - Composite: UP 0.6 per cent at 3,192.12 (close)

Euro/dollar: DOWN at US$1.1861 from US$1.1923

Pound/dollar: DOWN at US$1.3508 from US$1.3540

Dollar/yen: UP at 110.29 yen from 109.92 yen

Oil - Brent North Sea: UP 54 cents at US$78.77 per barrel

Oil - West Texas Intermediate: DOWN 17 cents at US$70.79 per barrel

Source: AFP/de

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