- Bridgette Randall
- 25 Mar, 2025
- London
European markets advanced, and investors reviewed economic reports from Germany, Spain, and the U.K.
Benchmark indexes in Frankfurt, Paris, and London jumped as much as 1% amid hopes of softer U.S. tariffs, but tariff turmoil and confusion dominated market sentiment.
German business morale indicator jumped in March following the lawmakers passing a historic debt reform, setting the stage for higher infrastructure and arms spending.
Germany has announced its plans to spend as much as 500 billion, about 11% of its GDP, to invest in improving its aging infrastructure, and the largest economy in the eurozone plans to increase its arms purchases and invest in the region's security.
The German Ifo Business Climate Indicator jumped to an 8-month high of 86.7 in March, the highest since July, the Ifo Institute reported Tuesday.
The measure of retail sales in the U.K. pointed to ongoing softness amid weakness in consumer spending and cautious wholesale trade.
The Confederation of British Industry Distributive Trades Survey declined by 18 points to -41.0, the lowest level since April 2024.
The index decreased for the sixth consecutive month in March and confirmed below-normal sales in the month.
Spain's producer price inflation accelerated in February from the previous month and extended gains to the fourth consecutive month, the National Statistics Institute reported Tuesday.
Producer price inflation advanced to an annual increase of 6.6% in March, driven by a 22.2% surge in energy prices.
However, excluding energy prices, prices remained flat after decreasing 0.2% in January.
EU Passenger Car Registration Declined In February
Passenger vehicle registration, a measure of automobile sales, in the European Union declined at a faster pace in February, the European Automobile Manufacturers' Association reported Tuesday.
The EU vehicle sales in February declined 3.4% to 853,670, following a 2.6% fall in the previous month.
Sales in Italy fell 6.0%, followed by a 4.6% decrease in Germany and a 3.3% decline in France. However, sales in Spain surged 8.4%.
In the first two months to February 2025, battery-electric vehicles accounted for 15.2% of total EU market share, higher than 11.5% in the comparable period of 2024.
Hybrid-electric vehicles surged, capturing 35.2% of the market and remaining the preferred choice among EU consumers.
Meanwhile, the combined market share of petrol and diesel cars declined to 38.8%, down from 48.5% over the same period in 2024.
Europe Indexes and Yields
The DAX index increased by 0.04% to 22,861.99, the CAC-40 index edged higher 0.4% to 8,055.58, and the FTSE 100 index advanced by 0.4% to 8,670.63.
The yield on 10-year German bonds inched higher to 2.79%, French bonds increased to 3.48%, the UK gilts moved up to 4.75%, and Italian bonds edged higher to 3.89%.
The euro decreased to $1.08; the British pound was lower at $1.29; and the U.S. dollar was higher and traded at 88.40 Swiss cents.
Brent crude increased $0.21 to $73.21 a barrel, and the Dutch TTF natural gas was lower by €0.05 to €42.18 per MWh.
Europe Stock Movers
Kingfisher plc plunged 13.3% to 242.54 pence after the home improvement retailer reported a decline in earnings in 2024.
Kuehne und Nagle International AG dropped 3.7% to CHF 204.70, and the Swiss logistics company offered a weaker-than-estimated operating earnings outlook for 2025.
TAG Immobilien AG decreased 1.9% to €12.05 despite the German residential real estate company reporting strong financial results in 2024.
The company highlighted its success in expanding its business in Poland's rental market and energy service business and added that it has reduced its vacancy rate in Germany.