In This Article:
Economic Calendar:
Monday, 25th January
ECB President Lagarde Speaks
German Ifo Business Climate Index (Jan)
Wednesday, 27th January
GfK German Consumer Climate (Feb)
Thursday, 28th January
German CPI (MoM) (Jan) Prelim
Friday, 29th January
French Consumer Spending (MoM) (Dec)
French GDP (QoQ) (Q4) 1st Estimate
Spanish GDP (QoQ) (Q4) 1st Estimate
Spanish CPI (YoY) (Jan) Prelim
German GDP (QoQ) (Q4)
German Unemployment Change (Jan)
German Unemployment Rate (Jan)
The Majors
It was a bearish end to the week for the European majors on Friday. The CAC40 and the EuroStoxx600 fell by 0.56% and by 0.57% respectively, with the DAX30 ending the day with a 0.24% loss.
Economic data from the Eurozone and continued market reaction to Thursday’s ECB press conference weighed on the majors.
Prelim private sector PMI figures for France, Germany, and the Eurozone were in focus in the early part of the European session.
A more marked contraction across the services sector dragged the Eurozone’s private sector deeper into contraction in January.
Concerns over the economic recovery were fueled further by the disappointing PMI numbers.
The continued rise in new COVID-19 cases and containment measures has questioned the ECB’s economic outlook.
Low vaccination rates across the Eurozone suggest that containment measures would need to remain in place for longer.
The Stats
It was a busy day on the economic calendar. Prelim private sector PMI figures for January provided direction in the early part of the session. The Eurozone’s composite PMI fell from 49.1 to 47.5 in January, according to prelim figures.
While France’s manufacturing sector saw a pickup in activity, Germany’s saw a modest slowdown.
The effect of lockdown measures across France and Germany were felt in the services sector, however.
France’s service PMI fell from 49.1 to 46.5, with Germany’s falling from 47.0 to 46.8.
From the U.S
January’s prelim private sector PMIs were also in focus late in the session. Better than expected figures failed to support a recovery late in the day, however.
In January, the U.S manufacturing PMI rose from 57.1 to 59.1, with the services PMI climbing from 54.8 to 57.5.
Low vaccination rates left the majors exposed to the latest spike in new COVID-19 cases, with a new wave in China also pressuring on riskier assets.
The Market Movers
For the DAX: It was a mixed day for the auto sector on Friday. Volkswagen rallied by 2.26% off the back of sales numbers for China, with BMW and Daimler rising by 0.49% and 0.07% respectively. Continental slid by 2.02%, however, to buck the trend on the day.